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Gold gifted by a relative is tax-exempt. But if received from a non-relative and valued over Rs 50,000, the full amount is taxed as income under the applicable slab
Gifts received during marriage, including gold and cash, are exempt from tax regardless of their value. (Representative/News18 Hindi)
In a significant relief to taxpayers, the Income Tax Department has extended the deadline for filing returns for the year 2025 from July 31 to September 15. This extension is particularly timely as it coincides with the ongoing wedding season, during which many individuals receive gold as gifts. It is essential for taxpayers to understand the tax implications of such gifts.
How Is Gold Taxed?
In India, the tax rules regarding gifts received on the occasion of marriage are quite specific. According to the Income Tax Act, gifts received during marriage, including gold and cash, are exempt from tax regardless of their value. However, if a gift is received on any occasion other than marriage and its value exceeds Rs 50,000, it will be subject to tax. Notably, there is no limit to the value of tax-free wedding gifts.
When Is Income Tax Applicable?
Income tax is applicable on the sale of gold received as a wedding gift. The profit—calculated as the difference between the sale price and the market value at the time of the gift—is subject to capital gains tax. This tax is classified as either short-term or long-term, depending on the holding period.
When Is Short-Term And Long-Term Capital Gains Tax Levied?
Short-term capital gains (STCG) tax applies if the gold is sold within 36 months (3 years) of receiving it. The profit from such a sale is treated as short-term capital gain and is added to the individual’s regular income, which is then taxed according to the applicable income tax slab. This means that, instead of a separate capital gains tax rate, the tax is paid based on the individual’s income tax slab.
If the gold is sold after more than 36 months, it is classified as a long-term capital gain and taxed at 20%, with the benefit of indexation to account for inflation.
How To Disclose Gold Sale In ITR?
When filing an income tax return, it is important to accurately report capital gains from the sale of gold. While gold received as a wedding gift is tax-exempt, it should be disclosed under the “Exempt Income” section to clarify its source to the tax authorities.
When Will Income Tax Be Levied?
The Income Tax Act specifies rules regarding gold received during marriage. If the gold is gifted by a relative, it is not taxable. However, if it is received from a non-relative and its value exceeds Rs 50,000, the entire amount becomes taxable as income, based on the applicable income tax slab.
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