Income Tax on Gifts

https://tax2win.in/guide/gift-taxation-exemption-relatives

Gifting is a precious tradition in India. But what about the tax implications? This video explains the rules for gift taxation in India.

What is a Gift under the Income Tax Act?

The Income Tax Act defines a gift as any money, movable or immovable property received without any consideration (payment). This includes:

• Cash, bank transfers, or cheques
• Movable properties: Shares, bonds, jewelry, artwork, etc. (including those received below fair market value)
• Immovable properties: Land, buildings, etc. (including those acquired below stamp value)

How are Gifts Taxed?
Gifts from relatives are generally exempt from tax, regardless of the amount. Relatives include:

• Spouse
• Siblings (yours and your spouse's)
• Parents' siblings
• Linear ancestors and descendants (parents, grandparents, children, grandchildren, etc.)
• Spouses of the above-mentioned persons
• Members of a Hindu Undivided Family (HUF)

Gifts from non-relatives exceeding Rs. 50,000 in a year are taxable. The entire amount received is considered income in the recipient's hands and taxed accordingly.

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