Save Rs 499 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

Clarification on cash gifts to relatives

Save Share

This query is : Resolved

pooja (Querist)
Follow

25 November 2012 hello friends... i recently read in a tribune newspaper dat in a gift transaction, both donor n donee r exempt from tax .... i m not sure in wat context hv they talked about the donor,.... money dat is given by donor to his relative is clubbed in doner's own income ..... so how can be donor exempt from tax ?????????...... did tribune mean to say dat the cash gifted by donor is a from post tax income ?????..... pls clarify soooooon

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
Follow

25 November 2012 Donor has to pay tax on his taxable income. The amount gifted is not an income but it is out of his ( in your words...post tax income)for the donor hence it is not taxable for him.
.
However, when a person receives a cash gift of more than Rs 50000/- from a non relative,
such gift becomes taxable in the hands of recipient.
.
So, you may go ahead with your above postulate.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join CAclubindia WhatsApp Finance Community & stay updated with the latest TAX news, compliance alerts and important updates all in one place!