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News India Live, Digital Desk: Big Change In Income Tax: Whether it is happy opportunities or just expressing love, giving gifts to loved ones and taking gifts from them is part of our tradition. But do you know that many times this cute gift can also cause trouble in your income tax file? Yes, the Income Tax Department now keeps a close watch on the gifts as well.
The Income Tax Act has special rules regarding gifts, and these rules are also less likely to change by 2025, which will always keep the risk of tax on the gift. If you are also thinking of giving or taking an expensive gift, then know these rules, otherwise you will have to pay a big penalty or tax of millions will be imposed!
How much tax is levied on the gift? Learn those 5 important things:
1. Rule on gift of cash or goods:
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Gift of over Rs 50,000: If you get a gift from someone who is not your “relative” and the price of that gift More than Rs 50,000 (including all gifts in a financial year)So on this entire amount, you will have to pay tax as ‘income from other sources’.
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Example: If your friend gifted you a clock of ₹ 70,000, then you will have to pay tax at a full ₹ 70,000, as it is more than ₹ 50,000.
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Note: Gift of less than Rs 50,000 is tax-free.
2. Gift from relatives (tax free!):
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Good news! If you gift Get from your ‘relatives’So no matter its price, There is no income tax on itIt is completely tax-free.
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Who relatives? According to the Income Tax law, there is a clear definition of ‘relatives’. This includes parents, spouses, siblings (of their and spouses), Lineal Ascendants (grandparents) and Lineal Descendants (children, grandson) etc. More than 50,000 gifts received from friends, neighbors, colleagues or relatives are taxable.
3. Gift on marriage (tax free!):
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Gifts received during marriage (whether it is cash or items), whether they have met anyone (relatives or not), Are completely tax-free.
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Note: This tax exemption is available only on ‘marriage opportunities’. The rules of common gifts apply to the gift after marriage or earlier.
4. Tax free or inherited gift (tax free!):
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If you get any gift will get any income tax on it or in inheritance.
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This property is considered ancestral and is out of the income tax circle.
5. Some other special cases (tax free):
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Gifts from local authorities (eg Panchayat, Municipality) are also tax-free.
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Some special charitable trusts or gifts from institutions may also be tax-free, if they follow the terms and conditions.
Why this rule is important to know?
If you do not know these rules and inadvertently take a gift of more than Rs 50,000 from a friend or non-relative and do not include it in income, then the Income Tax Department can send notice. This may have to pay you a fine or also take legal action.
Therefore, before taking or giving any gift, understand these rules so that there is no tax hassle later
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