Cash gifts received in excess of 50,000 are taxable under the head "Income from Other Sources" . But if cash gifts are received from Parents or Grandparents then whether limit of 50,000 would still apply or it can be any amount.
If someone can explain the provision in details...thanx
If gift received from parents there is no limit .
The same shall not be taxable in the hands of the receiver by virtue of provisio to clause (vii) of section 56(2) which states that gifts received(as defined by explanation to this section) from relatives are not taxed.
The section is 56(2) (vii).
IN CASE OF GIFT RECEIVED FROM PARENTS THAN THERE IS NO LIMIT
Under Gift income normally classified into 3 categeories sec 56(2)(vii) provided this provisions applicability only individual and huf
1. cash gift
2. immovable property
3. other specified assets
as per income tax act, 1961 clearly state that gift recevied with out any consideraration
1. cash gift in aggregate of cash exceeds 50000 in a previous year, entire cash recevied as a gift taxable in the hands of recevier
2. if immovable property (land or building or both )recevied as a gift in this aggregate term not used by the department .hence taxability arise only stamp duty value exceeds 50000 and provided value of property or stamp duty value which ever is higher is taxable in the hands of recevier
3.other specified assets (jewellary ,drawings, any work of art,securities, sculptures,archeological and bullion ) here taxability purpose fair market value will considered
In case any gift recevied from any one except other than above mentioned 3 categeories of gift income may be not taxable in the hands of receiver (eg car recevied as a gift not taxable in the hands of recevier because no where specified in the act)
And the same above mentioned assets not taxable in the hands of recevier provided gift recevied from
1. relative
2. entity registered as under 12AA
3.any fund or university,
4. local authority
5.charitable institutions
so, gift recieved from relatives is not taxable irrespective of the gift amount . there is no limit.
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