An Article on Gold
Gold is one the precious and high demand in the world. Gold is one that can store a country in place of foreign currency. Gold is safest investment compare to Equities.
Gold purity checks in karat(k). And 24k is the high purity one and for ornaments 22k widely used because original gold is very smooth and can't make ornaments with this. So Copper is added for making ornaments.
GST on Gold in India is 3%.
Gold, The following way married and unmarried woman, men can have the gold without documents( As of May 2024)
* A married woman can have up to 500 grams of gold without any proofs and beyond that limit should have valid documents
* An Unmarried woman can have 250 grams of gold without any proofs and beyond this limit should have valid documents
* Men can have 100 grams of gold without any proofs however can have beyond this limit with proper documents
Coming to investment stand point, There are three ways can invest in gold
1. Physical Gold:
Physical Gold is best option when buying gold for the ornaments to wear. This can be used for collateral for loan in financial institutions. When it comes to selling the old gold ornaments, surly can't say you will get good pay or right pay. Here One has to pay GST, making charges, import duty. Physical Gold storage cost is high.
2. Digital Gold:
Digital Gold is one the gold buying option and it is good when going for the Digitally store and store it digitally. Here GST has to pay along with gold price. And one more best advantage over this option is no need to bother about storage and can sell at anytime at that time rate , get deposited money in the respective added bank account. If gold price rise, the price of Digital gold will increase.
3. ETF Gold:
ETF Gold is one more investing opportunity in gold. ETF is Exchange Traded Fund, this is offered by some companies by changing a nominal charges. If the gold price rise, same will happen in the ETF. In this we need to buy at least one unit, price is different from one gold ETF to another.
ETF Gold storage cost is low and one can sell ETF in however sell order executed in market timings.
4. Gold Mutual fund:
Gold mutual fund is another option to park cash into gold . In this AMC charge amount and amount will change based on gold rate change.
In this option also storage cost is low and easy to sell and get cash into bank account
5. Sovereign Gold Bond:
Sovereign Gold Bond option is widely opted for investment. These are the bonds issued by RBI ( Reserve Bank of India). This is like buying gold and holding for 8 years(max time holding) after that can get the amount into bank accounts based on the at that time gold rate.
RBI offered to subscribe Sovereign Gold Bond four times per year. If want to subscribe, has to buy at least one gram of gold. Maximum gold can buy is 4k Gram per fiscal year.
These bond gives 2.5% Interest on invested amount bi-annually and as it is linked with RBI, safe and secure. Storage cost is null.
If wants to sell, this can be done in secondary market before 8 years. And can withdraw after 5 years but should contact before asked time. On maturity time that is after 8 years if hold the bond then tax free.
In Sovereign Gold Bond, the returns on gold will be higher than all above options with respect to gold rate as these gold bonds offering 2.5% interest per year in two terms
Conclusion:
Sovereign Gold Bond is having the tax exception. In remaining all investment options have to pay tax according tax slab
Better to have gold in one's portfolio to make diversification in investment and fair returns on gold investment as per the history of gold returns data.
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