TAXATION OF GIFTS: SECTION 56(2) OF THE INCOME TAX ACT, 1961
EXEMPTED GIFTS:
1. Any sum of money received (as gift) without consideration up to Rs. 50000/- in one year is not taxable.
2. Following receipts without consideration are exempt
a) Gifts received from ant relative
b) Gifts received on occasion of marriage of an individual
c) Gifts received under a will or by way of inheritance
d) Gifts received in contemplation of death of payer
e) Gifts received from local authority as defined in explanation to section 10(20)
f) Gifts received from educational or medical institution or fund etc. referred to u/s 10(23C)
g) Gifts received by any fund/ trust/ institution/ university/ other educational institution /hospital/ other medical institution referred to in sub-clause (iv) or (v) or (vi) or (via) of clause (23C) of section 10
h) Gift received by way of transactions not regarded as transfer under section 47(i)/ (iv)/(v)/(vi)/ (via)/ (viaa)/(vib)/(vic)/(vicb)/( vid)/(vii)
DEFINITIONS:
1. Relatives: As per the Income tax act, the sum of money received from any of your relatives are fully exempt from tax. Here the “relatives” term defines by the Income Tax act as follows :
- Spouse of the individual
- Brother or sister of the individual
- Brother or sister of the spouse of the individual
- Brother or sister of either of the parents of the individual
- Any lineal ascendant or descendant of the individual
- Any lineal ascendant or descendant of the spouse of the individual
- Spouse of the person referred to in clauses (ii) to (vi).
- In case of a Hindu undivided family, any member thereof;
2. Immovable property
- being land or building or both
- Shares and securities,
- Jewelry,
- Archaeological collection,
- Drawings,
- Paintings,
- Sculptures,
- any work of art or
3. Only single transaction is considered for calculating threshold limit of Rs.50000/- in the case of immovable property received as a gift. Where as in other cases (cash or movable property) all transactions in financial year are taken into consideration for calculating threshold limit of Rs.50000/-.
4. Stamp Duty Value means the value adopted or assessed or assessable by any authority of the Central Government or a State Government for the purpose of payment of stamp duty in respect of an immovable property.
Comments
Post a Comment
Your opinions are of interest to us.
We shall be only too receptive when you respond. BTW, comments are subject to moderation.