Gift to wife as flat

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This discussion clarifies the tax treatment of a husband gifting a flat to his wife. Gifts of property to relatives are generally exempt under Section 56(2)(x) of the Income Tax Act. The value to be reported as exempt income is the Cost of Acquisition (COA) to the donor, provided the property was purchased after 2001. If purchased before, the Fair Market Value (FMV) as of 01.04.2001 should be used. While not mandatory if not appearing in AIS, declaring it under Schedule EI is an option.

pooja

pooja (Querist)
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14 July 2023 If a husband gifts flat to his wife, it will be shown in exempt income but under which section and how much amount. The gift deed was created and stamp duty was paid.
Please help

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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14 July 2023 Gift to relatives are exempt u/s. 56(2)(x) of IT act.
Valuation being COA of Donor.

pooja

pooja (Querist)
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15 July 2023 Thanks a lot Sir for the quick reply

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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15 July 2023 Most welcome.

pooja

pooja (Querist)
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23 July 2023 Can we show this property in exempt income and the income will be COA of the donor, should we do that

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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23 July 2023 If it is reported in AIS, then yes declare it in schedule EI; otherwise not necessary.

pooja

pooja (Querist)
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23 July 2023 No Sir, it's not shown in AIS, I hope later it won't be a problem if we do not specify it anywhere though gift deed is made

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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23 July 2023 As it is not taxable income, you are not at fault even if you do not declare. But if you wish you can declare it under Schedule EI as suggested.

pooja

pooja (Querist)
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24 July 2023 Thank you so much Sir, you are so good, always a helping hand..

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Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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24 July 2023 You are welcome.

pooja

pooja (Querist)
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24 July 2023 Sir, I am showing it under EI but confused how much amount to show today's market value or COA to the donor or zero amount, sorry for troubling you

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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24 July 2023 COA to the donor., if donor purchased it after 2001.
If before, FMV as per sub registrar office dated 01.04.2001.

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