MY CLIENT IS A FEMALE. HER OWN BROTHER, BROTHER'S WIFE, BROTHER'S SON AND BROTHER'S SON'S WIFE IS GIFTING ONE LAKH EACH BY CHEQUE FOR HER 60TH BIRTH DAY. ARE THE GIFTS FROM THE ABOVE RELATIVES EXEMPT FROM INCOME TAX IN THE HANDS OF MY CLIENT.?
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Regarding Tax ability of gift from relatives
Replies (5)
Quick Summary
Gift from below would be exempt:
1) HER OWN BROTHER
2) BROTHER'S WIFE
Gift from below is taxable as it would not cover under the definition of relative as per Income Tax Act:
1) BROTHER'S SON
2) BROTHER'S SON'S WIFE
gifts from blood relation not taxable and gifts receive from grand father and mother
father in law and mother in law not taxable gift receive in marriage also not taxable
Just curious if this is legal work around?
Brother's son first gifts to brother (his father)
And then brother should gift it to her (i.e. sister)
Thanks for your kind response and opinion
Gift from specified relative is exempt from tax as per Section 56(2) of the Income Tax Act. Therefore, there will not be any tax liability on the gift of Rs 30 lakh received by your son. Also, there will no tax liability on you. Any income received on the gift amount will be taxable in the hands of your son
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