GOLD BUYING OPTIONS & TAXATION

BEST WAY TO BUY GOLD & TAXATION ON GOLD.

Everybody today is talking about buying Gold, this article will discuss various ways of buying gold & a comparison of various options.

Possible ways of Buying Gold are listed below:

1.       GOLD buying through Jewelry etc.

2.       GOLD Coins, Biscuits & Bars From Jewelers

3.       GOLD Coins, Biscuits & Bars From Banks or Post Office.

4.       GOLD ETF (Exchange Traded Funds)

5.       GOLD MF (Gold Mutual Funds)

6.       E-GOLD from NSEL (National Spot Exchange Ltd.)

EVALUATION CHART OF GOLD PURCHASES

	Sources
Factors	Jewelry	Coin-Jeweler	Coin-Bank	Gold ETF	GOLD MF	E-GOLD
Purity-Guarantee	Low-Medium	HIGH	HIGH	HIGH	HIGH	HIGH
Making Charges	10-15%	Nil	Nil	Nil	Nil	Nil
Premium over Spot Price	2-5%	0%	6-10%	0%	0%	0%
Other Costs of Buying	Nil	Nil	Nil	1.5% of Purchase	2.5% of Purchase	1.5% of Purchase
Maintenance Cost	Locker Cost	Locker Cost	Locker Cost	1% of Total value	2% of Total value	1% of Total value
Physical Delivery	Yes	Yes	Yes	No	No	Yes
Ease in Selling	Low-Medium	Medium	NO	HIGH	HIGH	HIGH
Long Term Cap Gain Applicable in	3 Yrs	3 Yrs	3 Yrs	1Yr	1Yr	3 Yrs
Wealth tax Applicable	Yes	Yes	Yes	No	No	Yes
Sales Tax Applicable	Yes	Yes	Yes	No	No	Yes-if you take physical Delivery
Recommendation	AVOID		AVOID		AVOID

 Looking at the above chart, if you are buying less than 100 GM (10 Tola) worth of gold in a year, it is better to go for COINS OR BISCUITS From Good Jeweler, But if you are purchasing more Quantity than this then go For the ETF fund with low expense ratio.