Daughter gift of rs 5 lakhs by bank transfer to mother. tax

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Dhiraj Arora (Querist)
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05 April 2017 Please help understand the following.

I (daughter) want to gift my mother Rs 5 Lakhs via check or bank transfer. Is cash gift a better option although not my preference?

What tax implication I and my mother may have per this transaction?
What precautions and documentation I and she may need to fulfill any tax obligations if any?

Please help so I can make an informed decision within legal guidelines.

Thanks,
Preeti Ahuja

CA Manali Maniar

CA Manali Maniar (Expert)
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05 April 2017 Gifts received from relatives are fully exempted from Tax, whether in cash or kind. So the cash gifted by daughter to mother is exempted from tax in the hands of mother.

Studentsca

Studentsca (Expert)
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05 April 2017 Prepare a Gift deed on stamp paper mentioning all the details for future reference.

CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)
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06 April 2017 You should gift the money by cheque or online money transfer only in view of new section 269ST applicable from April 2017 onwards in which any cash receipt of Rs. 2 Lakhs or more would invite penalty in the hands of recipient. There are no tax implications since gift to relatives are exempt. It is advisable to have a gift deed on stamp paper of appropriate value as per stamp duty act of your state. Also it is advisable that the daughter has sufficient capital/source of income to justify such a high amount. It would be better if she (daughter) files regular returns of income till date.

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