Selling Old Stuff? Know Which Sales Are Tax-Free

When you sell personal items like your phone or furniture, you usually don't pay tax. But gold, jewellery, and certain valuables are different — profits on those are taxable as capital gains. Here's the simple rule to follow.

Here's what happened: Indian income tax law exempts capital gains on 'personal effects' — everyday movable items like furniture, electronics, and clothing used for personal purposes.. Gold, silver, jewellery, precious stones, paintings, sculptures, and archaeological collections are explicitly excluded from the personal effects exemption and remain taxable.. Post Budget 2024, long-term capital gains on gold and jewellery (held over 24 months) are taxed at 12.5% without indexation benefit, making the tax cost more predictable but potentially higher..

What you should do: Check whether the item you're selling falls under 'personal effects' (phone, furniture, clothes = exempt) or excluded assets (gold, jewellery, paintings = taxable) before listing it for sale.. Calculate your holding period for any jewellery or gold — if held over 24 months, apply the 12.5% LTCG rate; if under 24 months, add the profit to your total income and pay at your slab rate.. Keep purchase receipts or bills for jewellery and gold items so you can accurately compute your cost of acquisition and avoid overpaying tax on the actual profit..

Inherited jewellery uses the original owner's purchase price as your cost basis — if grandparents bought it decades ago, your taxable gain could be massive. Get a valuation certificate before selling.

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