CA Sakchi Jain Instagram – Don’t take gifts exceeding 50k!
If the aggregate value of the gift(s) received without consideration exceeds Rs. 50,000 in a financial year, the entire amount becomes taxable as income from other sources.
Income tax is not applicable to gifts received from relatives. Friends do not fall under the definition of relative as per Income Tax Act. Thus, gift received from friends will be charged to tax if it exceeds the threshold limit of fifty thousand rupees.
The list of specified relatives includes parents, grandparents, siblings, aunts, uncles, spouse, and in-laws.
However, the exemption is applicable only to individuals and HUFs, and not to any other type of entity.
For instance, if you receive Rs. 75,000 as a gift from your friend, the entire amount of Rs. 75,000 would be added to your income and taxed at your slab rate. It would be considered “Income from Other Sources”. Here, the total value of all gifts received is counted. In another instance, in case you receive Rs. 50,000 from one friend as a gift and Rs. 25,000 from another friend, the limit of Rs. 50,000 would be considered to be breached. The entire gift value (Rs. 75,000) would be taxable in your hands.
[Income Tax Act, Section 56(2)(x), Gifts exceeding Rs 50,000, Tax implications, Blood relatives, Marriage gifts, Inheritance, Slab rate, Income from Other Sources, taxability of Gift, CA Sakchi Jain]
#IncomeTax #Gifts #TaxImplications #MarriageGifts #Inheritance #SlabRate #IncomeFromOtherSources #Taxation #Finance #casakchijain | Posted on 11/Apr/2024 19:40:18
