Gift tax

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Naina (Querist)

24 August 2018 Sir,
If a taxable person gives a gift of more than Rs.50,000 to a non-taxable person (Student(not Minor))
What will be the tax treatment in that case?

Sanket

Sanket (Expert)

25 August 2018 There is no tax on gifts, all gifts in excess of Rs 50,000 (other than those from relatives) and income generated through them get clubbed with the recipient's taxable income. However, income earned by assets gifted to minor children, spouse and son's spouse are included in the income of the donor for taxation.

If you want the money earned to be treated as independent income of your minor children, spouse or son's spouse, you will have to prove that the recipients had used their own acumen for making money from the gifted assets.

Naina

Naina (Querist)

25 August 2018 Sir my question was if the recipient is a person who does not file income tax return & he receives gift from non relative exceeding Rs.50,000.
Then will there be any tax implications?

Sanket

Sanket (Expert)

25 August 2018 First of all, Apology for misunderstanding.

As any income (other than the manual work done by him; or through any activity involving application of his skill, talent or specialized knowledge and experience derived by minor child) gets clubbed in the hands of the parent having higher taxable income.

ALOK GOEL

ALOK GOEL (Expert)

26 August 2018 1. The taxable income ( say 10 Lakh ) of doner is being given to non relative. As per Tax rule, the sudent ( less than 18 years) or minior are not liable to file any tax return what so ever they get money and it is taxble in the hands of dooner..
2. Now this whole 10L is clubbed with donner and he has already paid the tax So no more laibility.
3. Further if this 10L will earn intrest etc. if not used then whole intrest or any derived income from 10L will be taxable to donner / Minor & student's father only .

ok

Naina

Naina (Querist)

01 September 2018 Okay.Thank you Sir.
But actually my question is not about minor.
Sir my question is if the recipient of gift is a person who does not earn income (like student ABOVE 18 years of age) & he receives gift from non relative exceeding Rs.50,000. Then will there be any tax implication?

Sanket

Sanket (Expert)

03 September 2018 If an individual/Huf receives from any person or persons any gift, exceeding Rs. 50000 in any previous year, as per income tax laws, the aggregate amount shall be taxable as Income From Other Sources in the hands of individual or HUF under section 56.

Sanket

Sanket (Expert)

03 September 2018 As per Income Tax Act, receiver (donee) of gift is charged to taxation u/s 56(2)(vii). The donor of gift is not charged to taxation under this section. Read section 56(2) for exceptions.

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