How the bill is calculated

The bill, line by line

Bangaru Bill adds a bill up in this order. Each line has its rule beside it in the app.

1. Gold value

   Net weight × the rate for that karat. Net weight is the gross weight minus the weight of stones. You type the rate your jeweller quoted for that karat.

2. Wastage or VA

   A percentage of the gold value. “Wastage” (తరుగు) and “VA” (value addition) give the same rupees when both are a percentage of the gold at the same rate, so the app has one field for both. This is trade practice, not law.

3. Making charge

   Quoted three ways: a percentage of the gold value, rupees a gram of net weight, or a flat amount for the piece. Trade practice, not law. By default the rupees-a-gram figure is worked on net weight; a switch uses gross weight.

4. Discount

   On the making charge (percent or rupees) or on the invoice. GST is worked after the discount, because a discount shown on the invoice at the time of sale reduces the value GST is charged on.

5. Stones

   Charged on their own line, per piece or per carat. A stone set in the piece is part of a jewellery sale, so its value is inside the 3% base. The app never applies a stone or diamond rate to a set stone.

6. Hallmark and other charges

   A hallmarking charge shown on the bill is part of the same sale, so the app puts it inside the 3% base. This is our reading of the rule, not a ruling.

7. Taxable value, then GST

   The lines above, less any discount, make the taxable value. GST is 3% of it.

8. Round-off, total and amount to pay

   The total is rounded to the nearest rupee with a visible round-off line. If you exchange old gold, its credit is taken off the total to give the amount to pay.

GST: 3% on the whole value

Gold, silver and platinum jewellery is taxed at 3%. The notification lists it at 1.5% central tax, and the state tax is another 1.5%.

Within one state the bill shows CGST 1.5% and SGST 1.5%. Between states it shows IGST 3%. The total is the same.

The September 2025 GST reform left jewellery at 3%.

The CBIC FAQ for the gems and jewellery sector (Q7) asks about a 10 g chain sold for ₹30,000: gold value ₹28,000 plus making charges ₹2,000. Its answer is that GST is 3% of the total transaction value of the jewellery, whether or not the making charge is shown separately.

If a bill shows the making charge on its own line, the GST on it is still 3%.

Why 3% + 5% on making is wrong

Banks, blogs, TV channels and some apps say GST is 3% on the gold and 5% on the making charge. The CBIC FAQ above does not say that. It says 3% of the total value.

The 5% rate is real, but it belongs to something else: a registered goldsmith’s job charges when your own gold is made into jewellery. It is not a rate for the making line of a shop bill.

On the necklace in the worked example below, the same mistake adds ₹552. That is 2% of the wastage and making together, ₹27,600.

If your bill shows 5% on making, Bangaru Bill can reproduce it with a switch, so you can match the printed total. It then shows the difference and says: the CBIC FAQ rate is 3% on the whole value, ask your jeweller. This is a question to the shop, not an accusation.

Goldsmith job work: 5%

When you give your own gold to a goldsmith to be made into jewellery, the goldsmith’s labour is charged at 5% GST in total (2.5% central tax and 2.5% state tax) if the goldsmith is registered. The CBIC FAQ (Q8) says the registered job worker pays GST at 5% on job charges only.

The 5% is on the labour only. Your gold is not being sold, so it is not taxed. A small goldsmith who is not registered charges no GST.

The gold the goldsmith keeps as wastage (తరుగు) is shown in grams and in rupees as a cost. The app adds no GST to it. Whether GST applies to it is not settled in any source we found.

One point is open: the Act defines job work as work on goods of a registered person, and a family is not registered. In practice goldsmiths and sources use 5%, so the app does too, with this note.

Old gold and exchange

Selling your own old jewellery to a jeweller: a family is not in business, so the sale is not a supply, and no GST is charged on it. A CBIC and PIB press release of 13 July 2017 says this.

Exchanging old gold for new jewellery is different, and it is not settled. We found no circular, FAQ or ruling that says whether GST is on the full price of the new piece or only on the amount left after the old gold. Practice varies, and there is no ruling.

Most shops, including Hyderabad shops reported in the Telugu press, charge GST on the full price of the new jewellery and then take off the old-gold credit. The Gems and Jewellery Council FAQ points the same way. So Bangaru Bill uses the full bill by default, and a switch, “GST after old gold”, reproduces a shop that charges on the net amount.

The credit is the net weight of the old gold × the tested fineness ÷ 1000 × the rate you type, less the shop’s deduction. The deduction is trade practice. Some brands advertise 0% for an exchange; melting and refining is often 1% to 3%. The making charge and GST you paid earlier are not refunded.

Purity, hallmark and HUID

Hallmarked gold carries a BIS grade. The factor the app uses is the fineness divided by 1000, so 22K is 0.916, not 22 ÷ 24 (0.9167). The gap is real money: at a 24K rate of ₹14,750 a gram it is about ₹98 on 10 g.

21K is not a BIS grade. If your piece is marked differently, you can type a custom fineness.

A hallmark has three marks: the BIS logo, the purity (for example 22K916), and a 6-character HUID, which is unique to the piece. Since 1 April 2023 only hallmarks with a HUID may be sold.

For hallmarked articles the BIS rules say the invoice must show separately each article’s description, the net weight of precious metal, the purity in carat and fineness, and the hallmarking charge. It must also say you can have the purity checked at any BIS-recognised assaying and hallmarking centre.

Mandatory hallmarking covers most districts, not all, and the list keeps growing, so the app does not list districts. Articles under 2 g, and Kundan, Polki and Jadau pieces, are exempt.

The BIS CARE app has a “Verify HUID” feature. Bangaru Bill never says that a HUID is genuine. It explains what to look for and opens BIS CARE.

BIS rules also give a buyer compensation if a hallmarked piece tests below its mark. Bangaru Bill does not calculate it in this version. See the BIS page for the rule.

Rounding and the round-off line

The CGST Act rounds tax to the nearest rupee: 50 paise or more goes up. On a printed invoice, practice varies: some shops round each tax line, some show paise and a round-off line.

The app works out CGST and SGST separately, each rounded to the paisa (half up), and adds them for the GST. IGST is 3% rounded to the paisa. The total is then rounded to the nearest rupee, with the round-off shown as its own line. A switch turns rounding off, to match a bill that shows paise.

Example: gross 12.500 g with stones 1.200 g, making 10%, stones ₹8,000. Each half of the GST is 1.5% of the taxable value, rounded, so GST is ₹5,274.16 and not 1 paisa less. The total ₹1,81,079.16 is rounded to ₹1,81,079, a round-off of ₹0.16.

Rates, 22K from 24K, and తులం

You type the rate your jeweller quoted, per gram, for each karat. The app saves it with its date and time and shows it as “your rate”. It never fetches a rate.

If you leave the 22K or 18K rate blank, the app works it out as the 24K rate × the fineness (22K: 0.916) and marks it “derived”. Your shop’s own rate may differ.

The gram is the base unit. One sovereign or pavan is 8 g. The Telugu press quotes the price of 10 g as తులం, so తులం is 10 g by default in the app. The old tola, 11.6638 g, is a setting. Results show which one is used.

A worked 22K example

A 22K necklace, 20 g, rate ₹13,500 a gram, wastage 8%, making ₹300 a gram. CGST and SGST within one state.

You pay ₹3,06,528. Of that, ₹36,528 is not gold, which is 13.5% over the gold value of ₹2,70,000.

A bill that charges 5% on the wastage and making instead of 3% would show GST of ₹9,480 and a total of ₹3,07,080, which is ₹552 more.

What is not covered

Silver and platinum, diamond grading and prices, buying or selling gold, gold loans, and a seller’s own GST returns are outside the app. Silver is planned for a later version.

The app does not check whether a rate, a wastage or a making charge is fair, and it cannot read your bill from a photo. It checks the arithmetic of the figures you type.

Some points are our reading and not a ruling, and we say so on the line: GST on a hallmarking charge, GST on exchange, and GST on the gold a goldsmith keeps.

Found a rule that looks wrong?

Tell us which rule and which page you checked it against, and we will look at it.

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