Taxability of gift to unemployed major son
This query is : Resolved
pereiragreg
(Querist)
23 August 2015
My son is 19 years old but has no source of income as he is still a student.I am employed. I want to gift him money to purchase his Own home. Out of 40 lacs I can gift him 10 lacs from my savings. For the balance 30 lacs I propose to withdraw my PF amt & gift it to him. Can I legally gift both amounts to him & what will be the tax implications for us both?
pereiragreg
(Querist)
25 August 2015
Can some expert please advise?
26 July 2025
Here's a clear explanation of the **taxability of gifting money to your unemployed major son**:
---
### 1. **Can you gift money to your son legally?**
* Yes, as a parent, you can **legally gift money** to your son, whether he is employed or unemployed.
* There is **no legal restriction** on the amount you can gift.
---
### 2. **Tax implications for you (the donor):**
* **Gifting money is not a taxable event for the donor**. You do **not pay tax** on the amount gifted.
* Withdrawal from your PF (Provident Fund) is subject to PF rules and taxability:
* If PF withdrawal is **allowed tax-free** (e.g., after 5 years of continuous service), no tax on the PF amount.
* If PF withdrawal is premature, it might be taxable as per PF rules, but that tax is on withdrawal, not on gift.
---
### 3. **Tax implications for your son (the recipient):**
* Gift received by your **son from you (a relative)** is **fully exempt from tax under Section 56(2)(x)**.
* No matter the amount (₹10 lakh or ₹30 lakh), it is **not taxable in his hands**.
* Even though he is unemployed, **there is no tax liability on receiving gifts from a relative**.
---
### 4. **Points to note:**
* Keep **proper documentation** of gift (Gift Deed) to prove the nature of the transaction.
* When your son sells the property in future, **capital gains tax** will be applicable on the gains.
* PF withdrawal should comply with PF withdrawal rules to avoid tax complications.
---
### Summary:
| Person | Taxability on Gift Amount |
| --------------- | ---------------------------------------------- |
| You (donor) | No tax on gifting |
| Son (recipient) | No tax on gift received from parent (relative) |
---
If you want, I can help draft a sample **gift deed** or explain PF withdrawal tax implications!
---
### 1. **Can you gift money to your son legally?**
* Yes, as a parent, you can **legally gift money** to your son, whether he is employed or unemployed.
* There is **no legal restriction** on the amount you can gift.
---
### 2. **Tax implications for you (the donor):**
* **Gifting money is not a taxable event for the donor**. You do **not pay tax** on the amount gifted.
* Withdrawal from your PF (Provident Fund) is subject to PF rules and taxability:
* If PF withdrawal is **allowed tax-free** (e.g., after 5 years of continuous service), no tax on the PF amount.
* If PF withdrawal is premature, it might be taxable as per PF rules, but that tax is on withdrawal, not on gift.
---
### 3. **Tax implications for your son (the recipient):**
* Gift received by your **son from you (a relative)** is **fully exempt from tax under Section 56(2)(x)**.
* No matter the amount (₹10 lakh or ₹30 lakh), it is **not taxable in his hands**.
* Even though he is unemployed, **there is no tax liability on receiving gifts from a relative**.
---
### 4. **Points to note:**
* Keep **proper documentation** of gift (Gift Deed) to prove the nature of the transaction.
* When your son sells the property in future, **capital gains tax** will be applicable on the gains.
* PF withdrawal should comply with PF withdrawal rules to avoid tax complications.
---
### Summary:
| Person | Taxability on Gift Amount |
| --------------- | ---------------------------------------------- |
| You (donor) | No tax on gifting |
| Son (recipient) | No tax on gift received from parent (relative) |
---
If you want, I can help draft a sample **gift deed** or explain PF withdrawal tax implications!
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