Gift Tax

What is Gift Tax?

Any Individual who receives a gift (in any forms like property, cash, shares, automobiles, gadgets, jewelry etc.) from non-relatives, whose value is greater than 50,000/- (in current financial year) must pay income tax due on the value of the gift and disclose the taxable value of such gift in the return of income for current assessment year and subsequent years. These type of gifts are considered under Income From Other Sources section.

Following gifts are exempt from tax:

• Gift received in individual's wedding.
• Gift received from any relatives.
• Gift received under a Will or by way of inheritance.
• Gift received due to of death of the donor.
• Gift from any local authority.
• Gift from any fund or foundation or university or other educational institution or hospital or any trust or any institution referred to in Section 10(23C).
• Gift from any trust or institution, which is registered as a public charitable trust or institution under Section 12AA.

Income Tax Department considered below in relatives:

• Spouse.
• Brothers, Sisters and their spouses.
• Spouse’s brothers, sisters and their spouses.
• Brothers and Sisters of parents and their spouses.
• Any lineal ascendant (parents, grandparents, children, grandchildren) or descendants (children, grandchildren).
• Any lineal ascendant (parents, grandparents, children, grandchildren) or descendant of spouse (children, grandchildren).