Kalyan Wiki
Investment in Gold
Gold was the oldest form of currency used on Earth. In Indian mythology, Gold is considered to be auspicious and is often gifted to brides. Gold can be owned physically or in paper form. Physical Gold can be owned as jewellery, coins etc. whereas paper gold is in the form of investments in Gold Exchange Traded Funds (ETFs) and Sovereign Gold Bonds (SGBs).
Why do people invest in Gold?
-
Gold is easy to liquidate. It is always available to be readily liquidated whenever you require. The returns are not the same in the case of physical Gold. But in paper gold, it will be more.
-
Gold acts as a shield against inflation. Gold remains unaffected even during inflation. Regular currency generally varies according to the international market fluctuations.
-
Gold is considered as wealth in the Indian market. Gold has a special value in the Indian market.
-
Gold is a tangible asset. we can see that Gold can easily be converted to cash.
Gold purchased and sold within three years from the date of purchase, is called short term investment, while Gold that is sold after three years is a long term investment. Income tax on gains is fixed based on whether it is a short-term or long-term investment. Short term capital gains on the sale of Gold are added to your income and are taxable as per the income slab.
Benefits from paper gold are also taxable like physical Gold. Short term capital gains from investments held for less than 36 months is taxable by adding the income from investment to the total income and tax is levied as per the tax slab.
Investment in Gold in a diversified investment portfolio is a good option since the price of Gold is less volatile in the long term.
