GST is applicable on Gold and Jewellery that is made out of Gold. GST on Gold is 3% and extra 5% GST would be applicable on making charges. So, GST will be applicable on both – Gold @ 3% and also on making charges @ 5%.
Exp– While purchasing a necklace in which value of Gold is Rs. 100000 and Making Charges is Rs. 5000. In this case calculation of GST and value of Jewellery would be as below-
GST Price on Gold Imported from Outside Country
If gold is imported from outside country, NO GST will be applied however, custom duty @10% will be applicable on the value of imported goods. Hence, when a gold is imported out of no GST is payable but you have to pay custom duty @ 10% on value of gold/jewellery as per the situation.
Import of Raw Gold or Semi Raw Gold by Registered Individual or Business –
If Raw Gold, Semi Gold and even Jewellery is imported by the registered business or individual then also Custom duty @10% will be applicable, the custom duty will be added to the cost of imported gold, the indene of which shall be passed to the end user. Also, GST will be applicable on Custom Duty while making sale of Imported Gold in India. The Situation can be understandable form the below example.
Example – ABC ltd. Imported Raw Gold from UAE for Rs. 100000 on which Custom Duty @ 10% will be Applicable. Mr. E (an end user) buys jewellery made out of Imported Goods from ABC Ltd.
ABC Ltd. Apart from cost of gold charged Rs. 10000 as making charges. What will be the Cost of Jewellery to Mr E
The Calculation of Cost of Jewellery to Mr E is as below:
Points to Consider While making Purchase of Gold/Jewellery
Below things will save you from payment of extra Tax then what required
- Adornments are typically made using 22KT, 18KT and 14KT gold. Lesser the nature of gold – Lower the price will be and lower GST as well.
- If any Stone, Gems, Diamonds, etc. are included in Weight and Value of Jewellery make sure that Such Stone, Gems, Diamonds, etc. will be weight and valued differently as their tax treatment is different from Gold.
- Prices of Gold are tend to daily changes, so see the price of gold before making purchase.
- Make sure the Jewelery/ Gold you purchased is hallmarked/BIS certified.
Enquire with Certicom Consulting in case you have any further queries related to this.