Gift from Mother to Daughter (18+)

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Human
39 Points Posted on 02 March 2022

My mother wants to give 30lakhs to my sister to save her tax occuring due to interest income.

My sister will invest it in FD or bonds and keep interest earned with herself.

Is this permissable? I read that my mom can transfer this amount to sister as gift and no deed is needed. My sister will show this amount in exempt income in itr. Whether interest earned by my sister will be clubbed with mom's income ?

Based on info I've collected till now, it must be fine. Gift to daughter-> she'll invest it--> whatever interest she earns sister only will show in her itr and pay as per her bracket.

Please provide clarification. Thank you

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On 02 March 2022 at 20:04 Report
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Quick Summary
A mother wishes to gift her daughter £30 lakhs to help her manage tax liabilities from interest income. The daughter plans to invest the money in FDs or bonds and keep the earned interest. The discussion clarifies that such a gift is permissible without a deed, and the daughter can invest the money and report the interest income in her own tax return. The interest earned will not be clubbed with the mother's income, as it becomes the daughter's asset upon gifting.

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695 Points Posted on 02 March 2022

Your understanding is correct.

Your mother can gift as much as she wants to your sister. Then your sister can do whatever she wants with it. Any income your sister derives from this gift simply needs to be added to her other incomes. There's no separate distinction after having received the gift, assuming it's money being given.

There's no need for a deed either, so long as it's clear who gave the money to whom.

 

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On 02 March 2022 at 20:14
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Human
39 Points Posted on 02 March 2022

Thank you sir. I contacted CA in my town who said IT ppl will catch my sister if we do so coz it's being done for tax evasion. I had read otherwise on multiple sites. Thank you again. 

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On 02 March 2022 at 20:25
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695 Points Posted on 02 March 2022

You need to find a new CA!

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On 02 March 2022 at 22:03

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