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Tax on interest income of cash gift

Deepak suri (Government) (59 Points)

14 October 2020

My daughter, a student, aged 19 years, received gift of Rs 10 lakh from my mother (grandmother to granddaughter) and also Rs 5 lakh from me ( father to daughter). The total sum of 15 lakh is presently invested in her bank FD. What will be the tax implication on the interest earned. Wheather the clubbing of income provision be applicable in this case.

My daughter has no source of income .

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3 Replies

Anoop Bansal (student ) (199 Points)
Replied 14 October 2020

May be no clubbing is required.
Interest Income on FDR will be taxable as income from other sources
However FDR from Grand Mother will be taxable as Grand Mother is not covered in the definition of relative.

ayusmita (Tax consultant) (5885 Points)
Replied 15 October 2020

Both deed of gift are not taxable asper sec 56(2)(vii)
no you can't clubbing as she is no more minor
income for interest is taxable but if you have done tax free fd you get extempt upto certain amount in 80c

Anil Sharma (6 Points)
Replied 16 October 2020

On my retirement I got a sum Rs. 36lacs as tax free PF from company out of this I transferred a sum of Rs.14.50lacs ro my wife who is not a tax payer and she made FD for 1 year then after she converted it in to deposit for senior citizen scheme for a sum of Rs.15lacs for 5 years. Does it attracts any tax liability on her?