Taxation on gift of physical shares from paternal uncle

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

11 March 2010 What is the format and procedure for taking physical shares as gift from paternal uncle.
(1) The format of the gift deed
(2) Value of the stamp paper if required
(3) Validity of the stamp paper
(4) Notarsiation requirement.
(5) Impact on the receiver i.e the tax payable and procedure for declaring the same in the I.T return

Since it is urgent and inportant I will be obliged if somebody replies W.R.T the above mentioned points.

Aditya Maheshwari

Aditya Maheshwari (Expert)

11 March 2010 Declaration of gift can be made a plain paper also. It is preferable to be made on a Rs. 100/- stamp paper not older than 6 months from the date of gift.
Since the gift is taken from brother of your father there would be no tax payable on the same.

CA RAMESH KUMAR AHUJA

CA RAMESH KUMAR AHUJA (Expert)

12 March 2010 Agree with the expert. The same may be reflected in your Personal Balance Sheet as your investment in Shares by passing the following entry:

Investment in Shares Dr.
To Capital Account

One more thing which you should note is that a the following two clauses should appear in the Gift decleration itself.

"1.The said shares were purchased by me from the secondary market for a value of Rs...../- on (date), or

The said shares were allotted to me by the company on (date) against a sum of Rs..../-

2. Also, I have signed a Transfer Deed in this regard so that (name of the donee) may apply the company for transferring these in his name."

Such shares being physical should be got transgferred in due course of time.

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