Related to gift

Hello friends, One of my frd has daughter. Her daughter has received a gift as follow. Rs. 30000 as a FD from father , Rs. 30000 as a FD from grandfather, Rs. 30000 as a FD from aunty (father's brother's spouse) they r covered in the definition of gift. What is taxability of gift & interest income on fd in the hands of donor & donee. Is it necessary to execute gift deed? Please guide

Replies (7)

Hello,
Gift received from Relatives is fully exempted from the levy of tax and no income tax would be levied on such Gifts. (Father, Grandfather & Aunty are covered under relative definition, Gift received by daughter will not be taxable.)

 

Interest on FD will be taxable in daughter’s hand in case no-2(Gift received from Grandfather) & case no-3(Gift received from Aunty).Assuming daughter is major.

In case no-01(Gift received from Father), If daughter is minor then interest income will be taxable in Father’s hand. If not then taxable in daughter’s hand.

Thanks Vishal sir for replying. My friend's daughter is minor. What is taxability of Interest income generated from grandmother & aunty ? Is it necessary to executive gift deed ?
Thanks Vishal sir for replying. My friend's daughter is minor. What is taxability of Interest income generated from grandmother & aunty ? Is it necessary to executive gift deed ?
Thanks Vishal sir for replying. My friend's daughter is minor. What is taxability of Interest income generated from grandmother & aunty ? Is it necessary to executive gift deed ?
Thanks Vishal sir for replying. My friend's daughter is minor. What is taxability of Interest income generated from grandmother & aunty ? Is it necessary to executive gift deed ?
Thanks Vishal sir for replying. My friend's daughter is minor. What is taxability of Interest income generated from grandmother & aunty ? Is it necessary to executive gift deed ?

Hello,

Income of a minor is taxable in the hands of the parent whose total income is higher (before including the minor’s income). If the parents are divorced it is clubbed with the person who is maintaining the child.

When your minor child’s income is clubbed to your income – exemption is available up to Rs 1500 for each such minor child. Which means if clubbed income is more than Rs 1500, Rs 1500 is the maximum exemption, however if clubbed income is say Rs 800 (less than Rs 1500) exemption is limited up to such lesser amount, Rs 800 in this case.

Therefore interest income will be taxable in the hand of parent whose total income is higher ….

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