Income-tax rules, May 13 -- Profits or capital gains generated from sale of your digital gold, paper gold (which includes gold ETFs, gold mutual funds and sovereign gold bonds) and physical gold assets are taxed on short-term and long-term basis in India.

Notably, there is no tax for simply owning gold for personal purpose, the tax comes into play if and when you sell your gold for a profit. Thus, you are required to report capital gains from your gold investments in your income-tax returns (ITR) under specific schedules depending on the type of investment (physical, digital, or paper gold), according to a Clear Tax report.

Digital gold: Digital gold is purchased online, and the issuer stores them in a vault on your behalf. Notably, the...