Invest through family member

Hello,

What is the best way, that one can give some money, say 10 lacs to ones parents, from perspective of tax implications. What is the difference in the treatment of gift or a interest-free loan in this case. Is either of the parties liable for any taxes (say gift tax in this case).

 

What documentation would I need to keep in such case, and would I need to declare in IT returns of either party. Are there any accounts to be maintained for that.
 
I am assuming any income generated on the amount later on from interest etc would then be taxable under their account.
 
Sameer
Replies (1)

Any gift given to the relations is exempt from tax. Even the interst from such gifts are not taxable in the hands of donor. If it is interest free loan then the deemed interest will be the income in the hands of the donor.

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