Gold Limit at Home: How Much Gold Can You Keep at Home? Know the New Income Tax Rules to Avoid Trouble!

Gold Limit at Home: The demand for gold skyrockets during the festive season. Gold is not just an ornament but also a significant investment vehicle. But did you know that you cannot store unlimited gold at home? According to Income Tax Department rules, storing gold beyond a certain limit can land you in serious trouble, including hefty fines and even imprisonment. Let’s delve into the details.

What Are the Rules for Keeping Gold at Home?

As per the rules set by the Central Board of Direct Taxes (CBDT), there is a specific limit to how much gold you can keep at home. If you stay within this limit, the Income Tax Department will not question the source of your gold. However, if more gold is found, you will have to prove its legitimate source. If you have purchased gold from your declared income, agricultural income, or received it through inheritance, there is no limit on how much you can hold. You just need to have the proper documentation, such as purchase receipts or an inheritance will, readily available.

How Much Gold is Permitted for Whom?

The Income Tax Department has set different limits for holding gold based on gender and marital status. Let’s take a look:

• Married Woman: A married woman can keep up to 500 grams of gold jewelry.
• Unmarried Woman: For an unmarried woman, this limit is 250 grams.
• Man (Married/Unmarried): Any male member of the family, whether married or unmarried, can keep up to 100 grams of gold.

If gold is found within these specified limits during a search, income tax officials cannot seize it. The main purpose of this rule is to protect the gold that common people have acquired through family inheritance or their own purchases.

When Can You Receive an Income Tax Notice?

If more gold than the prescribed limit is found at your home and you cannot provide a valid source for it, the Income Tax Department can take action against you. To prove the source, you must have documents like purchase receipts, tax invoices, or legal papers related to gifts or inheritance. Without these documents, you may have to pay a substantial tax and penalty on the excess gold. Remember, purchasing gold worth more than ₹2 lakhs in cash without proper documentation can also bring you under the scanner of the tax department. Therefore, whenever you buy gold, make sure to take a proper bill and declare it in your income tax returns. This will protect you from any future legal complications.