I have sold gold and silver ETFs in the current financial year. Gold etfs was an SIP created in january 2024 and were held for more than 365 days and silver ETFs were held only for a month. My query is as under
Will the above gains be taxed as income from capital gains or other sources? If capital gains then as LTCG or STCG. What is the tenure to classify the gains of non equity trading into long term and short term. Can i avail the long term exemption of 1.25 lakhs agst these gains? What will be the rate of taxation? Any indexation benefits?? Can I set off equity trading losses against the above gains.
The gains from selling gold and silver ETFs are taxed under capital gains, not income from other sources.
Gold ETFs held for more than 12 months qualify as LTCG, while silver ETFs held for just one month will be treated as STCG. For non-equity ETFs like gold and silver, the 12-month holding period is the threshold to determine long-term vs short-term.
The ₹1.25 lakh LTCG exemption is not available here, as it applies only to equity shares and equity-oriented mutual funds.
So, the LTCG on gold/silver ETFs is taxed at 12.5% without indexation.
STCG is taxed at normal slab rates.
There is no indexation benefit for these assets.
And yes, you can set off equity capital losses against these gains, provided the set-off is within the same category - STCG against STCG and LTCG against LTCG.
We also have a detailed thread on gold & silver taxes: