Cash gift by grand mother to her grand daughter

This query is : Resolved

Quick Summary

Gift of Rs 50 lakh from grandmother to granddaughter is tax free under section 56 if properly documented and not in cash. Tax applies on grandmother for capital gains on sale of property, not on recipient.

Venkateshwarlu Pulluri

Venkateshwarlu Pulluri (Querist)
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20 March 2026 one grand mother is willing to transfer an amount of 50 Lakhs to her as a gift with love and affection on her grand daughter to survive herself in future, since she is no support of father, only mother is caring now,

is income tax applies on said cash gift to donee, since doner sold out her house property, out of said source she willing to transfer said amount.

please guide me in this regard.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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20 March 2026 Donor has sold out her HP, so check capital gain liability over the transaction. Tax liability arises over the sell transaction; no tax liability over donee for gift received from her grandmother through any banking channel.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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20 March 2026 👉 Gift from grandmother to granddaughter:
✔ Tax-free under Section 56(2)(x)

BUT

⚠️ Must ensure:
• NOT in cash
• Proper documentation maintained

Mention in gift deed:

“Given out of natural love and affection, without consideration, and from explained sources”

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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28 April 2026 Capital gain tax over the sell of HP is liable to be paid by Grandmother. Granddaughter can accept the gift tax free from the tax paid capital. Prepare gift deed for any future query.

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