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NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Taxation of Other Products

Under the Income-tax Act as applicable to the current NISM X-B syllabus, gold jewellery held by an individual as a capital asset and sold after holding it for 30 months is treated as which type of asset for capital gains purposes?

Gold jewellery held for 30 months is a long-term capital asset because physical gold is treated as long-term once held for more than 24 months. The gain is therefore taxed as long-term capital gain, not at slab rates as a short-term gain.

  1. AShort-term capital asset taxed at slab rates
  2. BLong-term capital assetCorrect
  3. CExempt capital asset
  4. DRevenue asset taxed as business income

Explanation

Physical gold and jewellery are treated as long-term capital assets when held for more than 24 months. At 30 months the holding exceeds this threshold, so the gain is long-term. The short-term option applies only to holding of 24 months or less.

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