Gift property to daughter in law: clubbing of income apply?

31 May 2017

An ancestral property at Delhi is being gifted by owner to daughter in law - registration will be done by paying stamp duty on circle value. She may then sell it at a higher value and offset the capital gain by investing in other property. In such a scenario will the amount (income) earned, by daughter in law, be included in owner's income? i.e. Will clubbing of income provisions apply for the owner. If yes who and how can we save capital gain.

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (159763 Points)
Replied 31 May 2017

" Will clubbing of income provisions apply for the owner."

YES.

"If yes who and how can we save capital gain."

By the gift there is no tax liability shifted from the owner (FIL) because of clubbing provision. Any tax exemption provision will not help to save tax.

Better had been to avoid the gift and purchase new house in name of DIL with joint name of FIL, with investment by FIL to save tax by exemption u/s. 54 available to FIL.

Mrunal Bhosrekar (2 Points)
Replied 04 October 2022

i have a doubt ... after gifting any property to daughter-in-law the income from that will be clubbbed in her father-in- law's income .... what if the father in law died just after transfer ? and the income gained from property which is gifted till howmany years it wil get clubbed in father in law's income? doent have any year limit .. that till this year the income will be clubbed in father in law's income ???????????????????