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Exchanging old gold jewellery for new is one of the most popular ways to upgrade jewellery in India — and when done right, it’s also one of the smartest. But the process is less straightforward than it looks: what jewellers offer, how they calculate the exchange value, and what you actually get back varies significantly. Here’s a clear explanation of how gold exchange works.
What is gold exchange?
You bring in your existing gold jewellery and use its value as credit towards a new purchase. The jeweller assesses the purity and weight of your old gold, calculates what it’s worth at the current rate, and deducts that amount from the price of your new jewellery. You pay the difference plus making charges and GST on the new piece.
How the exchange value is calculated
Exchange value = Gold weight (net) × Purity % × Today’s gold rate per gram — less a melting/refining fee of 2–5%. Making charges, design, original VA and stones are not counted — only the gold itself.
Example: 10g 22K (916) necklace at ₹7,000/gram. Exchange value = 10 × 0.916 × ₹7,000 = ₹64,120. Less 2% melting = ~₹62,837 credited towards your new purchase.
Exchange policies at major jewellers
- Tanishq — accepts any hallmarked gold, Karatmeter test on spot, 5% melting deduction standard. Best exchange promotions during Akshaya Tritiya and Dhanteras.
- Malabar Gold — accepts gold from any jeweller, 3–5% melting deduction, transparent counter process.
- Kalyan Jewellers — accepts old gold from any source, 2–3% melting deduction, purity test displayed on screen.
- Local jewellers — variable; melting deduction can range 3–8%. Always ask specifically what the exchange rate per gram is and what the melting deduction percentage is.
GST on gold exchange
If your new jewellery value > old gold value: GST (3%) applies only on the difference plus making charges. If your old gold value > new jewellery value: GST applies only on the making charges of the new piece. Always ask for an itemised bill and verify the GST calculation.
Tips to get the best exchange deal
- Compare exchange rates across at least two jewellers — the melting deduction varies and can mean ₹2,000–₹5,000 difference on a 20g exchange.
- Exchange during festival promotions — Akshaya Tritiya, Dhanteras and Diwali are when jewellers run their best exchange and making-charge offers.
- Bring your original bill — the HUID hallmark and original bill speed up purity verification.
- Know today’s MCX rate — check before you go so you can verify the jeweller’s valuation.
Browse new gold jewellery
Comparing designs before visiting a jeweller helps you negotiate better. Browse gold jewellery and accessories on Amazon India — or see global gold options.
Frequently Asked Questions
Do I get back making charges when I exchange gold?
No. Making charges are a one-time manufacturing cost and are not recovered on exchange. You receive credit only for the gold content — weight × purity × gold rate, less a melting deduction.
Can I exchange gold from one jeweller at another?
Yes. Tanishq, Malabar and Kalyan all accept gold from any source. Local jewellers vary — confirm before visiting.
The bottom line
Gold exchange is most cost-effective during festive promotions when melting deductions may be waived. Know today’s gold rate before you go, compare at least two jewellers, bring your original bill and ID, and verify the GST calculation on your bill. Making charges from your original purchase are not recoverable — that’s not a policy, it’s the nature of gold resale.