TAXATION OF GIFTS
RELEVANT PROVISIONS(SUMMARY)
(1) SECTION 47(iii) --- No Capital Gains shall arise in the hands of doner in case of gift...Here gift implies free of cost...For this purpose, transfer of capital asset for inadequate consideration is not a gift....
(2) SECTION 49(1)(ii) --- Where the capital asset became the property of the assessee under a gift the COA of the asset shall be deemed to be the cost for which the previous owner of the property acquired it....
(3) SECTION 49(4) --- Where the Capital Gain arises from the transfer of a Property, the value of which has been subject to income tax under clause (vii) or clause (viia) of section 56(2),, the COA of such property shall be deemed to be the value which has been taken into account for the purpose of the said clause (vii) or clause (viia)...
(4) EXPLANATION TO SECTION 2(42A) --- In case of gift, period for which capital asset is held by doner shall also be included in Period of holding of donee....Further, this provision shall not be applicable in case of gift is taxable in hands of donee in pursuance of section 56(2)...
(5) SECTION 56(2)(vii) --- Where an individual or HUF receives, in any previous year, from any person or persons on or after the 1st Day of October, 2009 ===>>
| NATURE OF RECEIPT | CONDITIONS | EXTENT OF INCOME | REMARKS |
| Any sum of money |
(1) During the P.Y. such individual or HUF has received any sum of money (cash, cheque, draft, etc.) from one or more persons... (2) Such sum is received without consideration. (3) The aggregate value of such receipt during the previus year exceeds Rs. 50,000. |
The whole of the aggregate value of such sum shall be considered as income of that previous year. | Aggregate amount of cash gift received during the period shall be considered. |
| Any Immovable Property |
(1) During the P.Y. such individual or HUF has received immovable property.... (2) Such Immovable Property is received without consideration.. (3) The Stamp duty value of such property exceeds rs. 50,000. (4) Such asset is a capital asset in hans of recipient.... |
The Stamp duty value of such property shall be considered as income of that previous year. | The limit of Rs. 50,000 is applicable per incidence. |
| Any Movable Property |
(1)During the P.Y. such individual or HUF has received Movable property.... (2) Such Movable Property is received without consideration.. (3) The aggregate FMV of such receipts during the previous year exceeds Rs. 50,000 (4) Such asset is a capital asset in hans of recipient....
|
The Whole of the aggregate FMV of such property shall be considered as income of the previous year.. | Aggregate amount of gift received during the period shall be considered |
| Any Movable Property |
1)During the P.Y. such individual or HUF has received Movable property.... (2) Such Movable Property is received for a consideration.. (3) Such consideration is Less than the aggregate FMV of the property by an amount exceeding Rs. 50,000. (4) Such asset is a capital asset in hans of recipient.... |
The aggregate FMV of such property Less consideration paid,, shall be considered as income of the previous year.... | Aggregate amount of gift received during the period shall be considered |
EXCEPTIONS :--- This clause shall not apply to any sum of money or any property received from relative,, occasion of marriage of the individual, under a will, etc....
(6) RECEIPT OF SHARES BY FIRM OR CLOSELY -- HELD COMPANY [ section 56(2)(viia)] w.e.f. 01-06-2010---
Following receipts by a firm or a company not being a company in which the public are substantially interested (i.e closely held company) shall be considerd as income :---
| NATURE OF TRANSACTION | CONDITIONS | EXTENT OF INCOME |
| Receipt of shares of a closely held company without consideration. |
(1) During the previous year, the assesse has received shares of a closely held company from one or more persons. (2) Such shares are received without consideration (3) Such shares are received on or after 01-06-2010. (4) The aggregate FMV of such asset received during the previous year exceeds Rs. 50,000 |
The whole of the aggregate FMV of such sum shall be considered as income of that previous year. |
| Receipt of shares of a closely held company inadequate consideration. |
1) During the previous year, the assesse has received shares of a closely held company from one or more persons. (2) Such shares are received for a consideration (3) Such shares are received on or after 01-06-2010. (4) Such consideration is Less than the aggregate FMV of the shares by an amount exceeding Rs. 50,000. |
The aggregate FMV of such shares Less consideration paid,, shall be considered as income of the previous year. |
EXEMPTED CASES :--- This clause shall not apply to any such property received by way of a transaction not regarded as transfer 47(via)/(vic)/(vicb)/(vid)/(vii)...
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@ Vipul Jain @
CAclubindia
