I want to know if the recipient of gift amount is free of income tax.
—RK Jain
Recipient of the gifted amount is not liable to pay tax on the amount so received provided the gift has been received from a relative. The term “relative” for this purpose means as under:
(i) In case of an individual:
(a) spouse of the individual;
(b) brother or sister of the individual;
(c) brother or sister of the spouse of the individual;
(d) brother or sister of either of the parents of the individual;
(e) any lineal ascendant or descendant of the individual;
(f) any lineal ascendant or descendant of the spouse of the individual;
(g) spouse of the person referred to in terms (b) to (f); and
(ii) In case of a Hindu Undivided Family, any member thereof.
My NRI son based in Australia wants to gift me Rs 10 lakh. My queries are as under:
i) What are the formalities to be completed?
ii) Can I invest this amount in property or FDRs in bank?
iii) I am a senior citizen and filing ITR regularly (non-taxable income). Please clarify whether this amount will be counted as my income.
iv) If yes, should I show this amount in the ITR column “Income from other sources”?
— IL Verma
Your queries are replied hereunder:
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