ID and Cash Limits for Buying Gold in India
In India you must give your PAN (or sign a Form 97 declaration if you have none) for any gold, silver or jewellery bill over ₹2 lakh, however you pay. Paying ₹2 lakh or more in cash is not allowed: the person who receives the cash is fined an amount equal to it. Since 1 April 2026 these rules sit in the Income-tax Act 2025 (section 186) and the Income-tax Rules 2026 (rule 159), with the same limits as before.
Facts checked 31 October 2026 · Not financial, legal or tax advice
At a glance
| Situation | Rule | Notes |
|---|---|---|
| Buying jewellery, coins or bars | PAN needed for a bill over ₹2 lakh; no ID needed below that. | Applies to any payment method. No PAN: sign Form 97 (replaced Form 60 from April 2026). |
| Paying cash | Cash of ₹2 lakh or more can't be received from one person in a day, for one transaction or for one event. | Penalty on the receiver equal to the cash taken (section 451). Pay larger amounts by card, UPI, cheque or bank transfer. |
| Selling old gold | Same PAN rule for a sale over ₹2 lakh; same ₹2 lakh cash limit. | As the seller you are the one receiving cash, so taking ₹2 lakh+ in cash puts the penalty on you. |
| Reported | Jewellers that are audited report cash receipts over ₹2 lakh to the tax department (SFT, Form 165). | Jewellers taking cash of ₹10 lakh or more also come under the anti-money-laundering law and report to FIU-IND. |
The rules in detail
- PAN: rule 159 of the Income-tax Rules 2026 (formerly rule 114B) requires PAN for a sale or purchase of goods exceeding ₹2,00,000 per transaction. The jeweller issuing the bill must record it. A person without PAN can give a Form 97 declaration instead.
- The Department of Revenue confirmed in 2021 that buyers of gold, silver or jewellery below ₹2 lakh don't need to show PAN or Aadhaar.
- Cash: section 186 of the Income-tax Act 2025 (formerly section 269ST) bars receiving ₹2 lakh or more other than by account-payee cheque, bank draft, bank transfer or a prescribed electronic mode. The limit counts all payments from one person in a day, all instalments of one transaction, and all payments for one event. Splitting a bill doesn't get round it.
- Money-laundering rules: since 28 December 2020, dealers in precious metals and stones that take cash of ₹10 lakh or more from a customer (in one go or in linked payments) are reporting entities under the PMLA. They must check ID, file cash transaction reports for cash over ₹10 lakh (counting monthly totals), and report suspicious transactions of any amount, including attempts.
- Hallmark: since 1 April 2023, gold jewellery sold by jewellers must carry a BIS hallmark with a 6-digit HUID code. You can check it in the BIS CARE app.
When you sell
- Expect to show PAN for a sale over ₹2 lakh, the same as when buying.
- For ₹2 lakh or more, take payment by bank transfer or cheque. Cash at that level breaks section 186, and as the receiver the penalty is yours.
- The jeweller doesn't withhold tax from you. Any capital gain is yours to declare.
Silver and travel
- Silver follows the same PAN and cash rules, because they cover all goods. Silver hallmarking is voluntary, but since 1 September 2025 any hallmarked silver piece must carry a HUID.
- Carrying gold into or out of India is a customs matter with its own allowances. See the travel-allowance page.
Gold ID and Cash Limits in India: FAQ
Is PAN mandatory to buy gold in India?
Only for a bill over ₹2 lakh, whether you pay by cash, card or UPI. Below that, no PAN or Aadhaar is needed. If you have no PAN, you can sign a Form 97 declaration instead.
How much cash can I pay for gold in India?
Less than ₹2 lakh per day, per transaction or per occasion. A jeweller who accepts ₹2 lakh or more in cash faces a penalty equal to the cash received, so pay larger amounts by card, UPI or bank transfer.
Can a jeweller pay me cash for my old gold?
Only below ₹2 lakh. As the seller you are the one receiving the money, so you would face the penalty for taking ₹2 lakh or more in cash. Ask for a bank transfer.
Did the rules change with the new Income-tax Act in April 2026?
The numbers didn't change. Only the section and rule numbers did: PAN quoting is now rule 159, the cash limit is section 186, and Form 60 became Form 97.
Sources (6)
- Income Tax Department: Rule 159, Income-tax Rules 2026 (PAN quoting)
- Income Tax Department: Rule 237, statement of financial transactions
- Ebizfiling: Section 186 of the Income-tax Act 2025 (successor to 269ST)
- FIU-IND AML/CFT/CPF guidelines for dealers in precious metals and stones (2023)
- The Statesman: No KYC for jewellery purchases below ₹2 lakh
- Deccan Herald: Silver hallmarking with mandatory HUID
General information for individuals buying or selling gold, checked October 2026. Rules change and dealers may ask for more than the legal minimum; check with the dealer or the regulator. Not legal advice.