Gold jewellery is always a pleasure to buy and wear, and we check its weight and price only when we pay the bill. They start out as pieces of jewellery that we long to add to our collection. But, they have an added value, as in investment, although it is only when we are looking at gold coins or bars that we think specifically of their investment value. Whatever the reason, gold has immense value in the market. Its value is determined by several factors and can largely depend on the prevailing market rates, its purity, and the weight of the gold itself. When it comes to buying gold jewellery, the price also includes making charges and the goods and services tax. So, how do you know to calculate the cost of your gold jewellery?
Jewellery sellers always use a particular formula:
Price of the gold jewellery = Gold rate x weight of gold (gms) + Making charges + GST, i.e., the prevailing rate of gold multiplied by the weight of the piece in grams, and added to making charges and tax.
For example:
If your jeweller quotes Rs. 47,300 for ten gms of 22K gold, and if you are buying a gold bangle that weighs nine grams, the jeweller will calculate the price of the item by
Rate of 1gm of gold = 4730
Price of the bangle weighing 9 gms = 4730 * 9 = 42,570.00
Making charges = 8% of 42,570 = 3405.60
Total price = 45,975.6
GST (calculated on total price) = 3% of 45,975.6 = 1379.00
Total billing amount is 42,570 + 3405.6 + 1379 = Rs. 47,354.6
Step-by-Step Gold Calculation for Different Karats
To accurately price jewellery of different purities (karats), apply these formulas:
- 22K Gold Content: Pure Gold Weight=Jewellery Weight×0.916Pure Gold Weight=Jewellery Weight×0.916
- 18K Gold Content: Pure Gold Weight=Jewellery Weight×0.75Pure Gold Weight=Jewellery Weight×0.75
- 14K Gold Content: Pure Gold Weight=Jewellery Weight×0.585Pure Gold Weight=Jewellery Weight×0.585
Always check hallmark for purity and verify using a gold purity calculator.
Try our CaratLane Gold Price Calculator for instant price estimates by entering the item’s purity, current rate, and weight
Factors to consider when buying gold jewellery
One of the factors that you must be aware of is that the price of gold will depend on the quality and location. First, the price of gold varies in terms of quality as there are different grades ranging from 9K to 24K. If the gold is of higher karats, the gold will cost more. For instance, if the price of 24K gold is Rs 40K/10g, then the gold of 22K or lower will also cost less and could be around 36,000 or 37,000/ 10g. The cost also depends on the state or city where you buy the jewellery. The price of gold per gram can be one in Karnataka and quite another in Delhi. Therefore, it makes sense to go online and compare prices among the locations and according to quality.
Gold Alloy & Colour Differences
Different gold colours—yellow, white, rose—are created by combining gold with varied alloys, which can affect both durability and price. Always check for certified gold and understand that alloy proportions directly change karat and total gold value.
Gold Conversion Table
| Karat | Purity % |
|---|---|
| 24K | 99.9% |
| 22K | 91.6% |
| 18K | 75% |
| 14K | 58.5% |
There is a price difference between gold and gold-studded jewellery.
Gold jewellery comes in different designs. They could be in plain gold, yellow, rose, or white, made into bangles, bracelets, necklaces, earrings, or rings. Then, there are some beautiful pieces that have diamonds or gemstones embedded in them. Some jewellery stores calculate the price of jewellery, including stones. But, it is always better to have the jeweller calculates the price of the gold and the stones separately. For example, if you are looking to sell or exchange your piece of jewellery, the jeweller will assess the item by taking the weight of the stones and deducting their price from the total price of the item. Moreover, the purity of the gold will also be evaluated before giving you the final price of the jewellery.
Gold Wastage, Making, and Labour Charges Explained
- Wastage Charges: Gold lost during manufacturing, usually 6–14%.
- Making Charges: Extra charges, as a percent of gold value or rupees per gram (e.g., “making charges for gold jewellery per gram”).
- Labour Charges: Fees added for intricate designs or manual work; always ask for a breakdown.
These charges impact final pricing—compare “jewellery making charges” and “gold wastage percentage” before buying.
GST and Tax Calculation
GST on gold jewellery is 3% of the total ticket amount (including gold value and making charges)
Example Price Calculations for Popular Jewellery Items
- 1 Gram Gold Maang Tikka Price: 1 × purity × live gold rate + making charges + GST
- 2 Gram Gold Ring (22K): 2 × 0.916 × gold rate + making charges + GST
For exact prices on specific items, use our gold price calculator or contact a CaratLane expert.
Gold Resale and Buyback Value
Old gold value is determined based on the current rate, purity, and deductions for stones, making and wastage charges. Use our “gold resale value calculator” to estimate returns before selling or exchanging your jewellery, CaratLane offers transparent buyback.
Buying gold jewellery needs more thought and consideration than buying costume jewellery. You may find jewellers selling both standardized and non-standardized jewellery. It is best not to assume that all the gold jewellery you see is pure or meets the required standards. Therefore, you would need to look for those certified by the Bureau of Indian Standards (BIS).
Making charges are also a portion of the total billing amount.
Now that you know the prevailing rates in your location, you must also consider how much the jeweller is going to add as making charges. Making charges can vary between 6% and 14% or more of the total weight of the gold. There are two ways the jeweller can calculate the marking charges. One way is to have a fixed rate per gram, and the other is to add a specific percentage of the total weight of the item. You may be able to save some money if you buy the jewellery that levies low making charges. If the jeweller is using the latter method, you can save even more money with them if you are looking to exchange old jewellery for new.
Standardized jewellery for true value.
Buying gold jewellery needs more thought and consideration than buying costume jewellery. You may find jewellers selling both standardized and non-standardized jewellery. It is best not to assume that all the gold jewellery you see is pure or meets the required standards. Therefore, you would need to look for those certified by the Bureau of Indian Standards (BIS). Standardized jewellery may cost a tad more, but it is well worth the extra price for assured purity.
Pure gold vs gemstone-studded jewellery
Now that you know how gold jewellery is calculated and the standards it must meet, you can see the difference in value between gold and gemstone-studded jewellery. Naturally, it is the pure gold pieces that will show a higher return on your investment. The returns are always going to be lower when it comes to stones.
Buying something you love that will last forever should be simple. But, often, it is a weightier matter because of the factors involved. However, at CaratLane, you will find that the whole process is made simpler because whatever pieces you choose will be of standardized gold, guaranteeing purity and superior quality.
Gold Rate in Major Cities
Gold rate today in Hyderabad, gold rate today in mumbai, gold rate today in kolkata, gold rate today in Pune, Gold rate today in chennai, Gold rate today in Bangalore, Gold rate today in delhi, Gold rate today in kerala, Gold rate today in Ahmedabad, Gold rate today in Vijayawada
Frequently Asked Questions – Gold Price Calculation
Q1. How does CaratLane calculate the gold price for jewellery?
A: We use today’s gold rate, calculate pure gold weight for the karat, add making and wastage charges, plus GST.
Q2. What are making charges in gold jewellery and how are they determined?
A: Making charges cover design and labour, charged as % or per gram. Always check the invoice for details.
Q3. How is wastage percentage in gold calculated?
A: Wastage is typically 6–14%; applied to gold value before final billing.
Q4. How do I use the gold price calculator online?
A: Enter purity, weight, and today’s rate for instant estimates (visit CaratLane’s calculator page).
Q5. How do I calculate GST for gold jewellery?
A: GST is 3% of (gold value + making charges).
Q6. How is gold resale or buyback value calculated for old jewellery at CaratLane?
A: Based on purity, current rate, and deductions for stones/making charges; get a quote instantly using our calculator.
Q7. How to calculate 22K gold rate from 24K gold rate?
A: Multiply 24K rate × 0.916 for pure gold content in 22K.
Q8. What should I check before buying gold jewellery in India?
A: Look for purity/hallmarking, compare making charges/wastage, and know current market rates.
Q9. Where can I check gold prices for major Indian cities?
A: Use CaratLane’s gold rate info page or contact us.
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