New Delhi, March 15 -- There are many avenues through which one can invest in gold. The major mediums are jewellery, gold coins, gold ETF and Sovereign Gold Bonds (SGB). The profits on these products are taxed differently. For the purposes of taxation, we can divide the products into two categories. In the first categories are gold products like jewellery, gold coins and gold ETF and the other category comprises of SGB. Let us examine the tax implications of both the categories of gold products.

The investments in gold products of this category are treated as capital asset under the income tax laws so any gains realised over its acquisition cost is taxed under the head "Capital Gains". However, those who deal in gold as jeweller or bulli...