These are some of the important questions, which might crop up in your mind but still remains unanswered:
Q1. Who all have to report jewellery to the Income tax officer and how?
Income Tax requires mandatory reporting on jewellery investments only from those who earn more than INR 50 Lakhs P.A.
It is suggested that people who are earning less than INR 50 Lakhs also may report jewellery investments to avoid any disconnect in future.
Reporting is done through income tax return form which is filed yearly once.
Q2. Should i also report gifts received in form of jewellery?
It is suggested that, a list of jewellery held with you, along with the purchase price and purchase date needs to be maintained year on year.
Gifts received are zero cost to you but as per the income tax rules, fair market value as on the date of receipt of gift needs to be ascertained and added in your investment value.
Q3. What all records needs to be maintained by you to support your jewellery investment?
i. For self purchase of jewellery – Tax invoice along with payment acknowledgement.
ii. For jewellery received as gift on the occasion of marriage – List of givers along with quantity and type of jewellery received from each giver.
iii. For jewellery received as gift other than above – Notarized Gift deed / will / partition agreement.
Q4. What if i don't have any document in support of the jewellery held by me?
As per the Government rules, even if you are not having any document supporting your jewellery investment, the income tax officer will not seize your jewellery upto the below limits:
Married woman – 500 grams of gold.
Unmarried woman – 250 grams of gold.
Married or Unmarried Man – 100 grams of gold.