Gift to parents

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

30 October 2014 Dear Sir

If i give gift of Rs 1 lac to my parents can i get income tax exemption. if yes under which head

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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30 October 2014 A gift that is received from a relative is fully exempt from tax. The gift can be in the form of cash, cheque, movable or immovable property.

Under the Income Tax Act, a 'relative' is defined as spouse, brother or sister, either of the parents, and lineal ascendant or descendant of the individual or spouse. Anyone else is regarded as 'non-relative' for tax purposes.

All gifts of movable and immovable property and monetary gifts worth more than Rs 50,000 from non-relatives are taxed. The tax is applicable on the whole fair MARKET value of the gift, not just on the amount in excess of Rs 50,000.

The gifts are taxed under the head 'Income from other sources'. It will be added to the total income of the donee and taxed at the applicable marginal rate of tax.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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30 October 2014 you wont get any exemption....

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