Digital gold is becoming a popular way to invest in gold online without the need to buy or store it physically. In India, people can purchase small amounts of gold digitally using mobile apps, and the same quantity of real 24K gold is securely stored in vaults by licensed companies. This makes investing easier, safer, and more convenient. Before investing, it’s important to understand how digital gold works, where to buy it, and what taxes apply.
What is Digital Gold
Digital gold in India eliminates the challenges of buying physical gold, such as verifying purity, storage, or paying making charges. You can easily buy it through apps like Paytm, PhonePe, and Google Pay, which partner with providers such as MMTC-PAMP, SafeGold, and Augmont. For example, if you buy gold worth Rs 500 on PhonePe, the same value of 24K gold is securely stored in your name in an insured vault. You can later sell it online or request delivery in the form of coins.
Taxes and GST
When buying gold, you must pay 3% GST on the gold price and 5% on making charges. As per new rules effective from July 2024, long-term capital gains on digital gold are taxed at a flat 12.5% without indexation. If sold before two years, short-term gains are taxed according to your income tax slab. Sovereign Gold Bonds remain tax-free if held till maturity. With clear tax rules and easy accessibility, digital gold continues to be a convenient and secure investment option for many Indians.
