Gift tax applicability

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R N Gajendragadkar (Querist)

05 January 2009 My father-in-law desires to gift a large sum to my minor daughter. The amount has already been taxed in his hands as income.

I would like to know whether this amount is likely to be taxable in my hand.

Alternately, can he gift this amount to my HUF / my wife.

CA RAMESH KUMAR AHUJA

CA RAMESH KUMAR AHUJA (Expert)

05 January 2009 Yes, gift to minor is taxable as Income from O/S in the hands of parent.

It can be gifted to ur wife or HUF

K V Subba Rao

K V Subba Rao (Expert)

05 January 2009 Please visit https://www.rediff.com/cms/print.jsp?docpath=//money/2007/sep/27tax.htm

to study Sri R N Lakhotia's Article.

As I understand there is no tax on amount gifted by one to grand daughter irrespective of whether grand daughter is minor or adult

That income earned by minor by investing money (received as gift) suffers tax in the hands of her father is a different matter

We have to distinguish between

(1) Tax on amount received as gift

(2) Tax on income earned by investing amount received as gift

CA Shailesh +91 9393926464

CA Shailesh +91 9393926464 (Expert)

07 January 2009 I second Mr. K V Subba Rao's Statement

R N Gajendragadkar

R N Gajendragadkar (Querist)

07 January 2009 thanks for the reply. with ref. hon. shri ahuja's comment, does grand father
( maternal ) not fall under the definition of relative under IT act?

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