Parents cash gift by cheque

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Hello friends, I have queries regarding, my wife has tuition income @ 2lack and file ITR regularly. 1. whether she can take cheque from her father @ 10 lack from his agricultural income. (my father in law is filling ITR ). 2. Is there any income tax rules will combines this 10lack as income in account of my wife?.
Replies (19)

Nope. The amt is either recd as a form of gift or loan. In both case, the nature of income is not to be considered, I.e agricultural or non - agricultural. It is better that such income is recd in form of gift as gifting amongst relatives is not taxable. Also document it for future reference, so it can act as a proof at a later stage for income tax purpose

With reference to the questions asked:

1. She can very well take the cheque from your father in law. In whatever way, it us taken that is either as a gift or loan, get it documented so that it can be a sufficient proof for it purpose

2. The income recd as a gift or a loan will not get added for the purpose of income tax calculation in hands of your wife's computation as agricultural income is earned by your father in law and hence agricultural income will be added for the purpose of income tax calculation in your father In law's computation 

However if the said agricultural income is earned by your wife and that income is transferred from your father in law's A/c to your wife 's A/c then that will not be in the nature of gift or loan. Rather it will be income earned BT your wife and subsequently such income will be added to your wife's computation for income tax calculation

Thank you very much

However I could not get your subject properly I.e Parents cash gift by cheque

Cash means money gift by cheque.

Okk. Got your point

Yeah thats correct

Sir ,does the limitations of Rs 50000 counts here?
Yes ,,I also want to ask the same question as asked by Nidhi..why not the the limit of 50000 is considered???

As the gift is being received from relatives i.e., her father so the limit of Rs. 50,000/- will not be considered. Experts please correct me if I am wrong.

Sir u asked to get it documented for further ITax purpose. What we have to in documentation
You are right sathish , gift from relatives are fully exempt, the limit of 50000 applies if anyone else gives the gift other than relatives
Rightly said Sathish. As per Sec 56 of the Income Tax Act, gift of any amount of money in whatever form received from a "relative" is not at all taxable.

@ Shashank Singh:

Documented in the sense that if the gift is either in cash or cheque, make a gift deed on plain paper, signed by donor and donee. Whereas in case of other type of movable gifts, get it notarized on stamp paper. And wrt immovable property you have to get it registered.

@ Nidhi and Arya Shaw:

No, the limit of 50000 is not considered when a gift is been given by a relative as it is specifically excluded. Also the are few more exceptions in which 50000 limit is not to be considered. They are gift recd in occassion of marriage, under a will or by way of inheritance, contemplation of death by payer or donor, as the case may be, local authority as defined in Explaination to sec 10(20), any trust or institution as referred in sec10(23C), trust or institution registered under 12AA.

HOWEVER the above exceptions are only applicable in case of an individual or HUF


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