⏳
Loading cheatsheet...
Physical gold, digital gold, Sovereign Gold Bonds, ETFs, and taxation on gold investments.
| Type | Purity | Liquidity | Entry Amount |
|---|---|---|---|
| Physical (Coins/Bars) | 24K (99.5%+) | Medium | ₹5,000+ |
| Physical (Jewellery) | 18-22K | Low | ₹10,000+ |
| Sovereign Gold Bonds | 24K (999) | Low-Medium | ₹1,000/unit |
| Gold ETFs | 24K (99.5%+) | High | ₹100-500/unit |
| Digital Gold | 24K (99.9%) | Medium | ₹1-100 |
| Gold Mutual Funds | Indirect (via ETFs) | High | ₹500 SIP |
| Gold Savings Account | Varies | Medium | Bank specific |
| Feature | Physical | SGB | ETF | Digital |
|---|---|---|---|---|
| Making Charges | 10-25% | None | None | None |
| Storage Cost | Locker fees | None | Demat | None |
| Safety | Risk of theft | Govt-backed | Demat | Secure |
| Tax (LTCG) | 20% w/ indexation | 20% w/ indexation | 12.5% w/o indexation | As physical |
| Interest Earned | None | 2.5% p.a. | None | None |
| Capital Appreciation | Yes | Yes | Yes | Yes |
| Purity Guarantee | Hallmark | Govt | AMC | BIS certified |
| Recommended | Jewellery only | ✅ Best long-term | ✅ Liquid | ✅ Micro investment |
GOLD INVESTMENT DECISION
│
┌───────────────┼───────────────┐
│ │ │
Consumption Long-term Small Amounts
(Jewellery) Investment (Micro saving)
│ │ │
Physical Gold SGB or ETF? Digital Gold
(Hallmarked) │ (Paytm, PhonePe)
│ ┌────┴────┐ │
18K-22K only Hold 8yr+? │ Buy ₹1-100/day
│ │ │ │
Avoid for YES → SGB NO → ETF Gold Savings
investment (2.5% interest) Schemes
purpose + tax benefit| Karat | Purity | Use Case |
|---|---|---|
| 24K | 99.9% (999) | Investment bars, coins (not for jewellery) |
| 22K | 91.6% (916) | Most Indian gold jewellery (standard) |
| 18K | 75.0% (750) | Durable jewellery, western designs |
| 14K | 58.3% (585) | Lightweight, daily wear jewellery |
# Gold Price Components
def calculate_gold_cost(weight_grams, purity_karat, rate_per_10g_24k, making_pct):
"""
Calculate final cost of gold jewellery
"""
purity = {24: 0.999, 22: 0.916, 18: 0.75}
pure_gold_cost = (weight_grams * purity[purity_karat] * rate_per_10g_24k) / 10
making_charge = pure_gold_cost * (making_pct / 100)
gst = (pure_gold_cost + making_charge) * 0.03 # 3% GST
total = pure_gold_cost + making_charge + gst
print(f"Weight: {weight_grams}g | Purity: {purity_karat}K")
print(f"Gold value: ₹{pure_gold_cost:,.0f}")
print(f"Making charges ({making_pct}%): ₹{making_charge:,.0f}")
print(f"GST (3%): ₹{gst:,.0f}")
print(f"Total: ₹{total:,.0f}")
print(f"Premium over pure gold: {((total/pure_gold_cost)-1)*100:.1f}%")
# Example: 10g 22K necklace at ₹65,000/10g, 15% making
calculate_gold_cost(10, 22, 65000, 15)
# Gold: ₹59,540 | Making: ₹8,931 | GST: ₹2,054 | Total: ₹70,525 (18.4% premium)| Platform | Provider | Min Investment | Conversion |
|---|---|---|---|
| PhonePe | Digital Gold (MMTC-PAMP) | ₹1 | To coins/bars (free delivery > 0.5g) |
| Paytm | Gold (MMTC-PAMP) | ₹1 | To coins (free delivery > 2g) |
| Google Pay | Gold (MMTC-PAMP) | ₹1 | Coming soon |
| Amazon Pay | Gold (Safeguard) | ₹5 | Limited options |
| Groww | Gold ETFs + SGB | ₹100 | Demat based |
| WazirX / CoinDCX | Crypto Gold (PAXG) | ₹100 | Crypto wallet |
def digital_gold_sip(monthly_amount, years, expected_return=10):
"""
Calculate digital gold SIP returns
"""
months = years * 12
monthly_rate = expected_return / 12 / 100
total_invested = monthly_amount * months
# Future value of SIP
future_value = monthly_amount * ((1 + monthly_rate)**months - 1) / monthly_rate * (1 + monthly_rate)
returns = future_value - total_invested
print(f"Monthly SIP: ₹{monthly_amount:,}")
print(f"Duration: {years} years")
print(f"Expected Return: {expected_return}%")
print(f"Total Invested: ₹{total_invested:,.0f}")
print(f"Expected Returns: ₹{returns:,.0f}")
print(f"Total Value: ₹{future_value:,.0f}")
print(f"Gold accumulated: ~{future_value/6500:.2f} grams (at ₹6,500/g)")
digital_gold_sip(2000, 10, 10)
# Invested: ₹2,40,000 | Returns: ₹1,56,000 | Value: ₹3,96,000| Feature | SGB | Gold ETF | Digital Gold |
|---|---|---|---|
| Return (8yr avg) | Capital + 2.5%/yr = ~12-14% | Capital only (~10-12%) | Capital only |
| Risk | Sovereign backed | Market risk | Platform risk |
| Liquidity | Low (5yr lock-in) | High (traded daily) | Medium |
| Cost | No expense ratio | 0.3-1% TER | No charge |
| Tax (LTCG) | 20% w/ indexation | 12.5% w/o indexation | 20% w/ indexation |
| Interest | 2.5% per annum | None | None |
| Denomination | Grams | Units (~0.5g each) | Fractional grams |
| Best For | Long-term (8yr) | Trading/medium-term | Small savings |
def sgb_returns(grams, issue_price, gold_cagr, years=8, interest_rate=2.5):
"""
Calculate total return from Sovereign Gold Bond
"""
# Gold appreciation
maturity_gold_price = issue_price * (1 + gold_cagr/100)**years
capital_gains = (maturity_gold_price - issue_price) * grams
# Interest income (semi-annual, paid on issue price)
total_interest = grams * issue_price * (interest_rate/100) * years
total_value = maturity_gold_price * grams + total_interest
investment = issue_price * grams
total_return = total_value - investment
print(f"Investment: ₹{investment:,.0f} ({grams}g @ ₹{issue_price})")
print(f"Gold price at maturity: ₹{maturity_gold_price:,.0f}/g")
print(f"Capital Gains: ₹{capital_gains:,.0f}")
print(f"Interest Income: ₹{total_interest:,.0f}")
print(f"Total Value: ₹{total_value:,.0f}")
print(f"Total Return: ₹{total_return:,.0f} ({total_return/investment*100:.1f}%)")
print(f"CAGR: {((total_value/investment)**(1/years)-1)*100:.1f}%")
sgb_returns(10, 6500, 10, 8, 2.5)
# Invested: ₹65,000 | Gains: ₹75,000 | Interest: ₹13,000
# Total: ₹1,53,000 | CAGR: ~15.7%╔════════════════════════════════════════════════════════════════╗
║ GOLD TAXATION GUIDE (FY 2024-25) ║
╠════════════════════════════════════════════════════════════════╣
║ ║
║ PHYSICAL GOLD & DIGITAL GOLD ║
║ ───────────────────────────── ║
║ STCG (held < 3 years): Taxed at your slab rate ║
║ LTCG (held > 3 years): 20% + 4% cess WITH indexation ║
║ Indexation benefit: Cost adjusted for inflation ║
║ ║
║ GOLD ETFs & GOLD MUTUAL FUNDS ║
║ ───────────────────────────── ║
║ STCG (held < 1 year): 20% + 4% cess ║
║ LTCG (held > 1 year): 12.5% + 4% cess WITHOUT indexation ║
║ ⚠️ Indexation benefit REMOVED for ETFs/Funds (Budget 2024) ║
║ ║
║ SOVEREIGN GOLD BONDS ║
║ ───────────────────────────── ║
║ Interest Income: Taxed at your slab rate (2.5% p.a.) ║
║ Capital Gains: 20% + 4% cess WITH indexation ║
║ (Still gets indexation benefit!) ║
║ ║
║ GOLD INCOME FROM GOLD MONETIZATION SCHEME ║
║ ───────────────────────────── ║
║ Interest received: Taxed at your slab rate ║
║ Capital gains on redemption: LTCG with indexation ║
╚════════════════════════════════════════════════════════════════╝# Physical Gold — LTCG with Indexation
def gold_tax calculation(purchase_price, sale_price, purchase_year, sale_year):
cost_inflation_index = {
2018: 280, 2019: 289, 2020: 301, 2021: 317,
2022: 331, 2023: 348, 2024: 363
}
indexed_cost = (purchase_price *
cost_inflation_index[sale_year] /
cost_inflation_index[purchase_year])
capital_gains = sale_price - indexed_cost
tax = capital_gains * 0.204 # 20% + 4% cess
print(f"Purchase: ₹{purchase_price:,.0f}")
print(f"Indexed Cost: ₹{indexed_cost:,.0f}")
print(f"Capital Gains: ₹{capital_gains:,.0f}")
print(f"Tax (20%+4%): ₹{tax:,.0f}")
print(f"Effective Tax Rate: {tax/sale_price*100:.1f}%")
# Example: Buy 10g @ ₹50,000 in 2019, sell @ ₹70,000 in 2024
# Indexed cost: ₹64,000 | Gains: ₹6,000 | Tax: ₹1,224| Portfolio Size | Gold Allocation | Suggested Mix |
|---|---|---|
| <₹10L | 5-10% | Digital Gold SIP + 1 SGB tranche |
| ₹10L - ₹50L | 10-15% | SGBs (70%) + ETFs (30%) |
| ₹50L - ₹2Cr | 10-15% | SGBs (60%) + ETFs (30%) + Physical (10%) |
| >₹2Cr | 10-20% | SGBs (50%) + ETFs (30%) + Physical (20%) |
| Timing | Strategy |
|---|---|
| Akshaya Tritiya | Auspicious; banks offer discounts |
| Dhanteras | Festival buying; special offers on coins |
| During corrections | 5-10% dip from highs = good entry |
| SGB tranche windows | Subscription period every 2-3 months |
| Dip in USD/INR | Weak rupee makes gold expensive; wait |
| Before rate cuts | Gold typically rises when rates fall |