Published 10 August 2026 by Rajesh Londe, Managing Partner, Londe Jewellers Gold & Diamonds | About the author
This grid works anywhere in India, because every figure in it comes from the same three inputs on any gold invoice. Read down for the type of piece, across for the deduction the jeweller applies when you bring it back. Every cell is the percentage the gold rate must rise before you are square. The making charge bands are the published slab at Londe Jewellers Gold & Diamonds, and GST is the flat 3 percent applied to the total invoice.
| Type of piece and making charge band | At 0% deduction | At 10% deduction | At 15% deduction | At 20% deduction |
|---|---|---|---|---|
| Plain 22K chains, bangles, rings and studs 8 to 12 percent making | 11 to 15% | 24 to 28% | 31 to 36% | 39 to 44% |
| Patterned designer and medium work pieces 12 to 18 percent making | 15 to 22% | 28 to 35% | 36 to 43% | 44 to 52% |
| Traditional Maharashtrian and antique filigree work 15 to 25 percent making | 18 to 29% | 32 to 43% | 39 to 51% | 48 to 61% |
| Heavy bridal and handcrafted karigari 20 to 28 percent making | 24 to 32% | 37 to 46% | 45 to 55% | 54 to 65% |
Read the first column against the last and the point of the whole page becomes obvious. A plain chain returned at zero deduction is square once gold has moved 11 to 15 percent. The same category of piece returned at a 20 percent deduction needs 39 to 44 percent, which is roughly three times the wait. Nothing about the jewellery changed. Only the counter it went back across.
Required rate rise equals 1 plus the making charge percentage, multiplied by 1.03, divided by 1 minus the deduction percentage. That is the whole calculation, and you can run it on a phone in ten seconds before you agree to anything.
The reason it works is that gold weight does not change. When you buy, you pay for the gold plus labour plus tax. When you come back, you are paid for the gold only. The rate has to close the gap between those two sentences. Notice what is missing from the formula: the gold rate itself. Break even is a pure percentage and it is identical whether the rate is Rs 6,000 a gram or Rs 12,000 a gram. So anybody who tells you to wait for a good rate to buy is answering a different question from the one that decides your outcome.
On any gold jewellery bill in India, exactly three things are being charged: the metal, the labour, and a flat 3 percent GST on the two of them together as a composite supply. Here is how a Rs 1,00,000 total splits at each making charge percentage. The GST column is the quietly interesting one.
| Making charge | Gold value in the bill | Making charge | GST at flat 3 percent | Total you pay |
|---|---|---|---|---|
| 8 percent | Rs 89,896 | Rs 7,192 | Rs 2,913 | Rs 1,00,000 |
| 12 percent | Rs 86,685 | Rs 10,402 | Rs 2,913 | Rs 1,00,000 |
| 18 percent | Rs 82,277 | Rs 14,810 | Rs 2,913 | Rs 1,00,000 |
| 20 percent | Rs 80,906 | Rs 16,181 | Rs 2,913 | Rs 1,00,000 |
| 25 percent | Rs 77,670 | Rs 19,417 | Rs 2,913 | Rs 1,00,000 |
| 28 percent | Rs 75,850 | Rs 21,238 | Rs 2,913 | Rs 1,00,000 |
The GST figure is Rs 2,913 on every row. It does not move when the making charge moves, because the tax is levied on the total invoice value rather than split across the components. This is worth knowing because the internet is full of the claim that gold attracts 3 percent on the metal and 5 percent on making charges. That 5 percent is the job work rate, which applies when a customer supplies their own gold and pays for labour alone. It is a different transaction and we do not bill it. Our full explanation of GST on gold jewellery sets out the government position on this.
The gold value column is the only column that can ever come back to you. Look at the spread. At an 8 percent making charge, Rs 89,896 of your lakh is metal. At 28 percent, only Rs 75,850 is. That Rs 14,046 difference is the entire argument for reading the making charge line before you fall in love with a design.
Break even is a question about the future. This one is not. If you bought the piece this morning and brought it back this afternoon at an unchanged gold rate, here is what lands in your hand at each deduction level. This is the honest floor of what jewellery is worth, and it is the number every buyer deserves before they sign.
| Making charge paid | At 0% deduction | At 15% deduction | At 20% deduction | Cost of the deduction |
|---|---|---|---|---|
| 8 percent | Rs 89,896 | Rs 76,411 | Rs 71,917 | Rs 13,485 to Rs 17,979 |
| 12 percent | Rs 86,685 | Rs 73,682 | Rs 69,348 | Rs 13,003 to Rs 17,337 |
| 18 percent | Rs 82,277 | Rs 69,936 | Rs 65,822 | Rs 12,341 to Rs 16,455 |
| 20 percent | Rs 80,906 | Rs 68,770 | Rs 64,725 | Rs 12,136 to Rs 16,181 |
| 25 percent | Rs 77,670 | Rs 66,019 | Rs 62,136 | Rs 11,651 to Rs 15,534 |
| 28 percent | Rs 75,850 | Rs 64,472 | Rs 60,680 | Rs 11,378 to Rs 15,170 |
The last column is the price of one sentence nobody says out loud at the time of purchase. On a Rs 1,00,000 plain gold purchase at a 12 percent making charge, a 15 percent deduction costs Rs 13,003 and a 20 percent deduction costs Rs 17,337. No difference in the rate quoted between two Nagpur shops comes anywhere near that. You can lose more at the buy back counter in thirty seconds than you could ever gain by shopping the rate for a month.
The single biggest lever on your break even that you control at the counter is which band of jewellery you buy. Our published slab has four bands and we print the percentage as its own line item on every invoice at all four Nagpur showrooms.
| Band | Making charge | Break even at 0% deduction | What sits in this band |
|---|---|---|---|
| Plain | 8 to 12 percent | 11 to 15% | Plain 22K chains, plain bangles, plain rings, studs |
| Patterned | 12 to 18 percent | 15 to 22% | Designer and medium work pieces, everyday sets |
| Traditional | 15 to 25 percent | 18 to 29% | Maharashtrian and antique filigree, Nagpuri karigari |
| Bridal | 20 to 28 percent | 24 to 32% | Heavy bridal, handcrafted statement pieces |
None of this means the top band is bad value. A hand made Nagpuri karigari piece takes a karigar weeks, and that labour is real, visible and the entire reason the piece looks the way it does. What the table says is narrower and more useful: buy the top band because you want to wear it, and buy the bottom band when the purpose is to hold gold. Trouble arrives only when a family buys 28 percent making charge jewellery believing it is a savings instrument. Full band by band detail sits in our making charges breakdown for Nagpur.
Most jewellers deduct 10 to 20 percent of the tested weight of your old gold as wastage or refining loss before they credit anything. Londe Jewellers Gold & Diamonds deducts 0 percent on 22K and 24K, so the credit is the full tested weight at that day's rate, and that holds for gold originally bought from any other jeweller. Purity is XRF tested at the counter in front of you rather than in a back room.
Three questions get you the truth anywhere you shop, and all three should be asked before you buy, not on the day you return. What percentage do you deduct on 22K old gold. Is the purity tested in front of me. Is the rate applied to my old gold the same rate you are selling new gold at today. A shop that answers all three plainly is a shop where the break even table above is the whole story. A shop that answers in generalities has a fourth number it has not mentioned. Our gold exchange policy for Nagpur states all three answers in writing before you walk in.
An exchange credits the value of your old gold against a new piece, so the metal stays metal and the only fresh cost is the making charge on whatever you take home. A cash sale converts out of gold entirely and normally carries a larger deduction, because the jeweller is buying inventory rather than trading it. That is why the same piece can produce two different numbers on the same day at the same counter, and it is not a trick, it is two different transactions.
Practically, if the plan is to keep holding gold, exchange is the cheaper route by the width of the deduction gap. If the plan is to leave gold, understand you are paying the exit cost once and in full. At our four showrooms all old gold payouts, refunds and returns are made by bank transfer or UPI, never in cash, which also means the transaction leaves you a record you can produce later. The old gold valuation guide for Nagpur walks through how the weight and purity are actually established.
If the purpose of a purchase is to hold value rather than to wear it, the making charge content is what you are trying to minimise. BIS hallmarked gold coins carry minimal making content compared to jewellery, so their break even sits close to the GST floor of roughly 3 percent at zero deduction rather than the 11 to 32 percent range that jewellery occupies. That is arithmetic, not a recommendation, and a coin will never be worn at a wedding.
The other route is to shorten the wait rather than the cost. A structured saving plan spreads the purchase across months so you buy at an average rate rather than one day's rate, which does not change the break even percentage but does remove the risk of the whole purchase landing on a peak. Our gold savings schemes in Nagpur and the live gold rate for Nagpur today are the two inputs to check before you decide which route fits.
The tables on this page are averages. Your own break even is knowable exactly, and it takes about five minutes at a counter. Bring the piece and the original invoice to Londe Jewellers Gold & Diamonds, Sitabuldi, at Modi Number 2, opposite Datta Mandir, Sitabuldi, Nagpur, Maharashtra 440012, phone +91 90755 12053, open 11 AM to 8:30 PM every day. Variety Square is the landmark on that stretch and Sitabuldi Fort and the railway station are both a short distance away, so it is reachable by auto, bus or private vehicle.
The same reading is available at our Gokulpeth, Manish Nagar and Nandanvan showrooms, all four keeping identical 11 AM to 8:30 PM hours and applying the same 0 percent deduction on 22K and 24K. We will test the purity in front of you, show you the weight on the scale, and read the making charge percentage off your old bill so the number you leave with is yours and not an average. Every new piece you take home is BIS hallmarked with its own HUID. Londe Jewellers Gold & Diamonds has been doing this for Nagpur and Vidarbha families since 1989. Golden Bonds of Trust.
The gold rate has to rise by the making charge percentage plus the 3 percent GST, and then by enough again to cover any buy back deduction. On a plain 22K piece bought at 12 percent making charge and sold back at zero deduction, the rate must rise about 15 percent. The same piece sold back at a 15 percent deduction needs about a 36 percent rise, and at a 20 percent deduction it needs about 44 percent. The formula is: required rise equals 1 plus the making charge, times 1.03, divided by 1 minus the deduction.
On a Rs 1,00,000 invoice at a 12 percent making charge, the pure gold value inside that bill is Rs 86,685, the making charge is Rs 10,402 and GST is Rs 2,913. If the buy back carries zero deduction you recover Rs 86,685 on the same day. At a 15 percent deduction you recover Rs 73,682, and at a 20 percent deduction Rs 69,348. The making charge and the GST are never recoverable at any jeweller, because neither is gold.
Because the deduction is applied to the whole weight of your old gold, while a rate difference is usually a few rupees per gram. A 15 percent deduction on a Rs 1,00,000 purchase costs about Rs 13,000 of recoverable value, which no realistic rate difference between two Nagpur shops will ever match. Most jewellers deduct 10 to 20 percent of the tested weight as wastage or refining loss. Londe Jewellers Gold & Diamonds deducts 0 percent on 22K and 24K, so the credit is the full tested weight at that day's rate.
No. GST is a tax paid to the government, not a component of the metal, so it never comes back to you. It is a flat 3 percent of the total invoice value, gold value and making charges together, charged once as a composite supply. On every Rs 1,00,000 gold invoice the GST portion is Rs 2,913, and that figure does not change with the making charge percentage because the tax applies to the total.
Plain machine finished pieces. Plain 22K chains, bangles, rings and studs carry the lowest making charge band, 8 to 12 percent at Londe Jewellers Gold & Diamonds, so at zero deduction they break even on a rate rise of roughly 11 to 15 percent. Heavy bridal and handcrafted karigari sits at 20 to 28 percent making charge and needs roughly 24 to 32 percent at zero deduction. Gold coins carry the shortest break even of all because the making content is minimal.
They are two different transactions with two different break evens. An exchange credits the value of your old gold against new jewellery, so the gold stays gold and only the making charge on the new piece is a fresh cost. Selling for cash converts the metal out of gold entirely and typically carries a larger deduction. At Londe Jewellers Gold & Diamonds old gold payouts, refunds and returns are made by bank transfer or UPI, never in cash.
Bring it to any of the four Londe Jewellers Gold & Diamonds showrooms in Nagpur at Sitabuldi, Gokulpeth, Manish Nagar or Nandanvan, all open 11 AM to 8:30 PM. The Sitabuldi showroom is at Modi Number 2, opposite Datta Mandir, Sitabuldi, Nagpur 440012, phone +91 90755 12053, a short walk from Variety Square. Purity is XRF tested in front of you, the weight is read off the scale while you watch, and the deduction is 0 percent on 22K and 24K. There is no charge and no obligation to buy.
Bring any gold piece and any jeweller's bill. Purity XRF tested in front of you, weight shown on the scale, 0 percent deduction on 22K and 24K. Four Nagpur showrooms at Sitabuldi, Gokulpeth, Manish Nagar and Nandanvan, all open 11 AM to 8:30 PM. Serving Nagpur families since 1989.
Call Sitabuldi Gold Exchange Policy