Share Tax Rules: If you have also received shares as a gift from a relative, then read up to what amount of shares you will not have to pay tax at all.
This is a useful news for those who invest in the stock market. If you have also received shares as a gift from someone and do not know what are the tax rules for this, then read this news. Ashok Gupta from Prayagraj asked a question related to this to tax expert Mukesh Patel in CNBC Awaaz’s special show Tax Guru. Ashok Gupta told that he has received shares worth Rs 70,000 as a gift from his wife’s brother, what are the tax rules on this.
There is no tax on gift of shares up to Rs 50,000.
Tax experts said that if shares worth up to Rs 50,000 are received as gifts from relatives (Share Tax Rules) and no other gift is received in that business year, then no tax is levied on it. Know further what are the rules (Tax Rules for Gift Shares) if shares worth more than Rs 50,000 are received as gifts.
Tax rules on shares received as gift
Mukesh Patel said that if the gift is more than Rs 50,000, then first you have to see whether the gift (Shares on Gift Rules) will be considered received from a relative or not. Gifts received from people listed in the list of relatives issued by the Income Tax Department are tax free. The list of relatives in section 56 (2) also includes brother-in-law. Therefore, Ashok Gupta will not have to pay any tax, whether he has received shares worth Rs 70,000 or Rs 7 lakh as a gift.
LTCG rules
Now the question is when will it be considered long term. The special provision for this is that when you get something as a gift, there is a rule for when you got it. Even if you get the share today and you sell it tomorrow, it will still be considered long term because if the period of holding of the person who gave it to you exceeds 1 year, then it will be considered long term. That is, LTCG will be applicable on shares one year after the original purchase date.
Also Read-
- How to Check Income Tax Refund Status
- Income Tax Rules: How to save income tax on income up to Rs 10 lakh
- Income Tax VS TDS: What is the difference between Income Tax and TDS, know here
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