Tax Rules on Gifts: There has always been a tradition of giving gifts to relatives and friends on special occasions. Sometimes small gifts to big and expensive gifts are also available, but remember that the gift received from someone also comes under the purview of income tax in India.
New Delhi. Tax Rules on Gifts: Diwali is about to come which is at the end of this month. Everyone likes to give and receive gifts on Diwali. People give different types of gifts including cash, sweets, clothes, gold ornaments. Apart from this, giving expensive gifts like cars and property is also considered auspicious on the occasion of Diwali. Even the company distributes gifts to the employees as bonus on Diwali. If you are also going to get a gift or bonus, or have received it, then once you must know the rules related to its tax. Be it a gift or a bonus, or a gift of money, it is important to know its tax rules.
As per section 56(2) of the Income Tax Act, gifts received in a financial year can be taxed as “income from other sources” as per the slab rate. However, gifts from close family members are exempted. Although Diwali gift generally depends on the person giving it. Under section 56(2)(x) of the Income Tax Act, 1961, gifts received by the taxpayer are liable to tax. These items are included in the gifts that are taxable.
No tax on car
Under the Income Tax Act, assets worth more than Rs 50,000 such as shares and securities, jewellery, archaeological collections, paintings, paintings, sculptures and art or bullion etc. can include anything. However, the car does not come under the purview of property. Hence the car may not be subject to gift tax.
Tax exemption on gifts received from them
Gifts received from relatives are tax free under Section 56 of the Income Tax Act. According to the Income Tax Act, husband, wife, brother, sister, brother-sister of husband and wife i.e. brother-in-law and sister-in-law, siblings of parents i.e. maternal uncle and uncle, people with whom blood is related, or people with whom husband and wife have blood Be it a relation, they come under the category of relatives. Any type of gift received from these people is not taxed. But friends do not come under the category of relatives, the gifts received from them are taxed.
These things are taxed
Any immovable property like land, building, etc. having stamp duty of more than Rs 50000, jewellery, shares, paintings or other costly articles exceeding Rs 50000, other than immovable property Any property worth more than Rs 50000 is included.
