TAXABILITY OF GIFTS RECEIVED FROM RELATIVES AND NON RELATIVES
Gifts received from relatives are exempt from tax. Who will be considered as relative for the purpose of claiming such an exemption?

As per the income tax act of section 56, 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 spouse of the individual
Any lineal ascendant or descendant of the individual
In case of Hindu undivided family any member thereof.
 

Are monetary gifts received by an individual or Hindu undivided family taxable?

For Example: if you are receiving sum of money Rs 10000 from your uncle

It is fully exempt from tax

If the following conditions are satisfied then any sum of money received (i.e, monetary gift may be received in cash, cheque or draft etc) by an individual / HUF will be charged to tax.

Sum of money received without consideration
The aggregate value of such sum of money received during the year exceeds Rs 50000.
Marriage of the individual is the only occasion when monetary gift received by him will not be charged to tax

Are monetary gifts received from abroad chargeable to tax?


If the aggregate value of monetary gift received during the year by an individual or HUF exceeds Rs. 50,000 and the gifts are not covered under the exceptions discussed in earlier part, then gifts whether received from India or abroad will be charged to tax.

 
What is tax treatment of immovable property received as gift by an individual or HUF?

Are gifts of movable property received by an individual or HUF charged to tax?

If the following conditions are satisfied than immovable property received without consideration by an individual or HUF will be charged to tax:

Immovable property, being land or building or both is received by an individual or HUF.
The immovable property is a capital asset.
The stamp duty value of such immovable property received without consideration exceeds Rs 50000.
 

GIFTS RECEIVED FROM NON RELATIVES

Here non relatives means anyone who doesn’t come under the above mentioned relation for year.
In this case tax you are exempt up to maximum of Rs 50000 for a financial year
If you receive the sum of money worth more than 50000 you are liable to pay the tax on aggregate amount i.e. total amount received
This rule applies when the gift is a sum of money, whether in cash , by way of cheque, bank draft or any articles which is value more than Rs 50000
For example when you are receiving a gift of Rs 1 lakh for the best performing in your company Rs 1 lakh shall be liable to tax.
TAXABILITY OF GIFTS RECEIVED FROM RELATIVES AND NON RELATIVES
Sathish 3 December, 2022
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