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Gift from daughter to mother

Ritesh Agarwal (Student) (57 Points)

18 February 2015

If a married daugther gifts Rs. 8 Lakhs to her mother, Is there any tax implication?

Can the amount of Rs. 8 Lakhs be gifted in cash ( say 20 installments of 40,000.00)?

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19 Replies

PSPSPS (Practicing) (1344 Points)
Replied 18 February 2015

Mother Daughter ( Even Though Married ) fall under the defination of Relative under I T Act, Hence Gifts from Relatives of any amount is Tax Free. So there is no need to break the Gift amount in Installments if you have the full amount available, you can gift in at one stroke also.The Provision of Tax Free Gift to Relatives mentioned above is prevailing ason this date ( this Year ) Incase it gets changed / Amended in Future than such amended provisions will become applicable

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GULRAJ AILANI (CA) (234 Points)
Replied 18 February 2015

The amount gifted should be by Bank only if it exceeds Rs 50000

1 Like

vishvesh (student) (24 Points)
Replied 18 February 2015

But clubbing provisions will get applied na?

nitesh (Finance Manager) (21 Points)
Replied 18 February 2015

It's tax free because these are gift item and no tax consumption in this case.....

Yatin Sharma (seeking articleship) (36 Points)
Replied 19 February 2015

If 40000 is being gifted in 1 year then it will be exempt.

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Ritesh Agarwal (Student) (57 Points)
Replied 19 February 2015

Thanks a lot to PSPSPS.

Please let me know, if there are any chances of clubbing provisions getting applied in this case?

binayak goswami (Income Tax Practitioner) (34 Points)
Replied 19 February 2015

off course clubbing provision ll definitly b there. say sum1 X gifted a sum to his parents and his parents invested the same in STDR. The interest amount ll b generated out of this investment ll be added to X's account i.e. Donor's account and not in d Donee's account. so the interest amount will b taxable in the hands of X.

1 Like

Arif Ali (Apt Co Advisory) (1230 Points)
Replied 19 February 2015

Originally posted by : Ritesh Agarwal
	Thanks a lot to PSPSPS. Please let me know, if there are any chances of clubbing provisions getting applied in this case?

Hi Ritesh,

yes clubbing provision will be applied. If mother invest this anywhere and earns income, then that income will be taxed in hand of daughter.

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Arif Ali (Apt Co Advisory) (1230 Points)
Replied 19 February 2015

Originally posted by : GULRAJ AILANI
	The amount gifted should be by Bank only if it exceeds Rs 50000

Hi Gulraj, can you please explain which section restricts to pay the gift above 50000 by cash.

1 Like

GULRAJ AILANI (CA) (234 Points)
Replied 19 February 2015

I had checked there is no restirction on Gift by cash exceeding Rs. 50000. You can gift it by cash mode also. Please consider this corrected Opinion.

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Vishal Goel (Chartered Accountant) (1693 Points)
Replied 20 February 2015

Hello,

Not agree with arif

Clubbing provision not apply.

Vishal Goel (Chartered Accountant) (1693 Points)
Replied 20 February 2015

Hello,

Section 62 in the Income- Tax Act, 1995 (Irrevocable Transfer of Assets)

Where an asset is transferred to any person

1. by way of trust which is not revocable during the lifetime of the beneficiary, OR

2. in the case of any other transfer, which is not revocable during the lifetime of the transferee;

then all income arising from such asset, shall be included in the income of the transferee and not in the income of the transferor. This shall apply only if the transferor derives no direct or indirect benefit from such income in either case.