There are many such occasions where we give gifts to our friends, close ones and relatives. But sometimes you also have to pay tax on gifts. If you want to give a gift to someone close to you, then first understand these rules well.
Income Tax Rules on Gifts: We all exchange gifts. There are many occasions like birthday, engagement, wedding, tonsure etc where we give gifts to our friends, close ones and relatives. But sometimes you also have to pay tax on gifts. There are some tax related rules in the case of gift giving, about which people are not aware. This rule depends on the value of the gift and your relationship with the giver. Let us tell you about it.
There is no tax on giving gifts to them
If your relatives and close relatives give gifts, then there is no tax on them, but if any of your friends gives you a gift then it comes under the purview of tax. Husband-wife, siblings, brother or sister of husband/wife i.e. sister-in-law, sister-in-law, brother-in-law, brother-in-law of mother/father i.e. aunt, uncle, aunt, uncle, grandparents, husband/wife The wife’s grandparents, son or daughter and brother/sister’s husband or wife are kept in the list of relatives. If they give you a gift then it does not come under the purview of tax.
These gifts are counted in taxable income
Your friends and acquaintances are not your relatives, you are not related to them by blood, hence their gifts come under the ambit of tax. However, not every gift is taxed. If your friends or acquaintances give you more than Rs 50,000 in cash as a gift, or gift land or house, shares, jewellery, painting, statue etc. whose value is more than Rs 50,000, then it is counted as taxable income. Is. It is necessary to give this information in the income tax return. If tax liability arises after tax calculation, then you have to pay that tax. Whereas even if the gift from relatives is worth more than Rs 50 thousand, it is considered tax free.
Understand these rules well
- There is no tax on gift transactions between husband and wife because the income from gift transactions comes under the purview of income clubbing.
- If property, shares, bonds, vehicles etc. are received from relatives then they are tax free, if received from friends or acquaintances then they are taxable.
- The gift received on marriage is completely tax free, whereas the gift received from the employer comes under the ambit of tax.
- If a gift worth up to Rs 50 thousand is received from friends or acquaintances in a year, it is kept tax free, if the value is more than Rs 50 thousand, tax has to be paid.
- There is no tax liability on property received from close relatives, but tax has to be paid on the sale of that property.
- There is no tax on the property received in the will, but tax has to be paid on selling this property.
