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Tax Implications on Gold ETFs

Roseita D'Souza wants to know the tax implication on short-term capital gains of Gold ETFs

I have earned short-term capital gains of around Rs 5,000 by trading in Gold ETFs. What is the applicable tax rate for this short-term capital gain?
- Roseita D'Souza

For income tax purposes, gold exchange traded funds are treated as debt funds, not equity. On redemption, the units of Gold ETFs held for more than a year qualify for a long-term capital gain tax of 11.33 per cent without indexation, or 22.66 per cent with indexation. If the period of holding is less than a year, the short-term capital gain will be clubbed with the income of the individual investor, to be taxed as per the applicable tax slab of the investor.

So in your case, the short-term capital gain of Rs 5000 from gold ETFs will be added to your income and will be taxed as per the tax bracket you fall under.



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