According to tax and investment experts, there is no restrictions on the quantum of gold jewelry or ornaments one can hold in India. However, to ensure uniformity and avoid disputes, the CBDT has directed its officials not to seize gold jewelry and ornaments up to a prescribed level. As per the Income Tax Department norms, a married lady can posses up to 500 gm gold without invoice while in the case of unmarried lady and male this limit is 250 gm and 100 gm respectively.

Speaking on the CBDT’s prescribed limit for men and women, Archit Gupta Founder and CEO at Clear said, “The prescribed limits are 500 grams of gold jewelry/ornaments for a married lady and 250 grams for unmarried females. According to CBDT rules, married and unmarried males can hold a maximum of 100 grams of gold jewelry. Moreover, IT officials cannot seize gold ornaments and jewelry up to the specified limit, even if a family’s income or status in society does not warrant holding so much gold jewelry. The CBDT instruction covers gold jewelry owned by a family. The IT officials can seize gold jewelry belonging to a non-family member irrespective of the quantity.”

Archit Gupta of Clear went on to add that if one owns more gold jewelry than the specified limit, the tax officials will not seize it if one substantiates the source of acquisition of the surplus quantity. For instance, if you have inherited gold jewelry, you must show documentary evidence displayed through a WILL supported by the ITR of the deceased person.

“Although IT officials will not seize one’s gold jewelry up to specified limits, they will record the quantity of gold jewelry. One will have to disclose the source of gold jewelry. If you have purchased the gold jewelry out of the money on which tax is paid, you must prove that you bought the jewelry,” Archit Gupta said.

Suggesting gold buyers to keep invoice, Amit Gupta, MD at SAG Infotech said, “There is certain limit beyond which gold without invoice can be quizzed under Section 132 of the Income Tax Act. The Income Tax Department also says that if you buy gold, then you must mention about it in the asset details while filing your Income Tax Return (ITR) for that year.”

The managing director of the SEBI registered tax solution firm went on to add that the law was made in December 2016 as there was a myth among Indians that they can hold unlimited quantity of gold without invoice. He further added that for Income Tax Department, gold means all forms of physical gold that includes gold jewelry, gold coins, bars, etc.

On how to avoid income tax quizzing if someone has gold without invoice beyond the given limit, SEBI registered tax and investment expert Jitendra Solanki said, “In India, one gets gold from ancestors without invoice. So, it’s important for you to know how much gold without invoice a household can possess. Being known to the limit, if there is any further addition of physical gold from ancestors or from any relative, then it’s advisable to mention about it in your asset details during ITR filing.” Solanki advised gold possesses to get the valuation of the gold done immediately after getting it from ancestors or from any relative if the invoice is not there. It will help them inform the income tax department about the asset details in regard to gold possession.