Gift in kind will be taxable from 01.10.2009
- Tuesday, July 7, 2009, 17:12
- Income Tax
- 270 views
According to the new proposal of the Union Budget 2009-10, any property received from a non-relative where the value is in excess of Rs 50,000 in a particular year will be considered as income in the hands of the recipient.
Earlier, gifts in the form of cash from non-relatives were exempted up to a limit of Rs 50,000 a year (if sum exceeds Rs 50,000, then entire amount is eligible for being taxed).
While this limit remains unchanged, the key change proposed is aimed at bringing in non-cash gifts into the tax ambit.
Earlier, gifts in non-cash form (like shares and securities, jewellery, archeological collections, paintings and gold), even if they were in excess of Rs 50,000, were exempt from any tax in the hands of the recipient.
In case of immovable property, the value as determined by the stamp duty ready reckoner will be considered for tax purposes. However, an area of concern remains, which is the valuation part.
With this amendment fair market value’ of a property other than immovable property could become an area of contention — for example, there could be valuation issues in case of a property, like a piece of painting. However, though the CBDT would prescribe the rules for valuation of other properties, there could be disputes on valuation. In case of immovable property, the issue is that it would tantamount to double taxation (Section 50C taxes capital gains in the hands of the seller, while the new proposal would tax the difference between stamp duty value and consideration in the hands of the purchaser).”
In case of transactions involving immovable property but wherein a consideration is involved, the amount eligible for being taxed would be the difference between the stamp duty value and the consideration paid (for other movable property, the ‘fair market value’ would be considered as against stamp duty).
However, the proposal provides for some exclusion, which includes receipts on occasion of a marriage or by will or inheritance or from certain specified authorities (educational or medical institutions among others).
If take gift cash/cheque more than Rs 50000/- should be treated as income or exempt in income tax
i have received a gift from my brother of his share in the commericial premises at mumbai via gift deed registered on 23.09.09 will this be taxable?the share certificate transfer will be effected after 01.10.2009.
No as deed get registered before 01.10.2009.
Hi,I want to know that can a son gift his property to his mother without any gift tax to any party
Thank you
According to the new proposal of the Union Budget 2009-10, any property received from a non-relative where the value is in excess of Rs 50,000 in a particular year will be considered as income in the hands of the recipient.
If a son gift property to mother then value of property will not be taxable in the hands of mother.
there was a mistake in the gift deed registered( gift of his share of property given by my brother to me). the registration office entered the place name instead of the first name of the witness. if i make a rectification deed, what date will be calculated as date of transfer of my brother’s share for income tax purpose. the gift deed as registered on 24th september. also is it necessary to make a rectification deed, as the witness whose name was wrongly typed is my husband?
if the date of rectification deed is calculated for income tax then will my brother’s gift to me be taxable?
Original deed date will be taken as date of gift that is 24.09.2009. Its better to make rectification deed to rectify mistakes in deed.
Even gift of property after 30th September from relatives within the meaning of section 56 is not taxable. In Your case gift will not be taxable as it is from relatives. Gift in kind from non relative after 30th September is taxable.
For the purpose of git Relative means:
Spouse
Brother or sister
Brother or sister of the spouse
Brother or sister of either of the parents of the individual
Any lineal ascendant or descendent(A lineal descendant is a person who is in direct line to an ancestor, such as child, grandchild, great-grandchild and on. Similarly, a lineal ascendant is parent, grandparent, great-grandparent and so on.)
Any lineal ascendant or descendent of the spouse
Spouse of the person referred to in (2) to (6)
Can younger sister who was married and now she is a widow can she make a immoveable property gift which is self owned to her younger sister who is married.
Is there any problem in this case where doner husband side relativies can challenge the gift deed.
Is there any TAX problems in this gift deeds.
please replay to me at lokesh4u_it@yahoo.com
please ignore the upper comment
Can elder sister who was married and now she is a widow, can she make a immovable property gift which is self owned, to her younger sister who is married.
Is there any problem in this case where elder sister husband side relatives can challenge the gift deed in court.
Is there any TAX problems in this gift deeds.
Is registration charger we need to pay to registration office.
please replay to me at lokesh4u_it@yahoo.com
As far as Income tax act is concerned elder sister can gift to younger sister and vica -versa and there will be no tax on the same.
Registration need to be done and registration charges will be applicable.
Thank you very much Sandeep for your suggesions,
The Property is bought newly, is there any time limit to execute the gift deed.
I am worried about any hidden taxes ?
No hidden tax will be there as per Income tax but for registering the deed you have to pay stamp duty and registration. Its better to execute the deed at the earliest and from Income Tax point before the end of Assessment year.
Hi,
I Work for IT Ferm my taxable income is 6lackh ( Salary)
and I have invested 600000 lackh rupees in bank as Fixed deposits
and i am taking the intrest monthly 9.5 %
a) Now what will be my taxable amount?
b) FD intrest is taxable ? ( If yes what is the percentage)
c) While filing the IT returns do i need to include the (FD-intrust+ Salary-Income) also?
e) is that Salary income and FD income are clubbed together and then taxed
( If yes what is the Percentage for FD and what for Salary)
Kindly suggest my question
Thank you
A) to tell your taxable amunt we need breakup of your salary.
b) yes FD interest is taxable and is taxable at normal rates there is no special rate for this.
c) Yes both will be taxable but under separate heads.
d) No Salary will be taxable as Income from Salary and Interest will be taxable as income from other Sources.
e) Tax Slab for Individual are as follows:-
On first 1,50,000/- of Income Nil.
On Next 1,50,000/ of Income 10%
On Next 2,00,000/ of Income 20%
On balance 30%
3% Education cess will also be applicable on Tax amount calculated as per above.
Hi Sandeepji,
Can a son-in-law give gift to his mother-in-law, will that a taxable?
Because in defination of relative its not clear about this. There are reference of non taxable gift other way round like from father-in-law or mother-in-law to son-in-law but not vice versa. Can you please answer that?
Thank you.
If you can take from someone without attracting tax provisions then you can git them too and same will not be taxable in their hand. So individual can receive gift from spouse of son or daughter too.
Is there any standered Gift Deed format&
Will upload one on Monday in Income Tax form section.
my father wants to give his property as gift to me. Let me know if it will be taxable?
No it will not.
thank you very much Mr. Sandeep. I was guided wrongly by an advocate yesterday & he mentioned to me that it will attract tax.
In fact, my dad owns the house & wanted to go for reconstruction. He is retired & he cannot avail loan. So he wants to gift that property to me, so that I can avail loan on his behalf. I hope this will be okay.
Income tax will not be there but stamp duty and registration fees for gift deed will be applicable.
How much will be the stamp duty?
That you have to ask your advocate only.
thank you once again.
Hello Sandeep,
Nice article. Any income generated out of the money gifted by me to my mother, will it be clubbed to my income and taxed or will it be clubbed to my mother’s total income and taxed(if applicable)?
regards,
satish
X received a gift of immovable property from her mother’s brother’s daughter in 1991. The gift deed is being documented and registered now in February 2010.
Will a gift tax be payable by X? Or can the gift deed mention that possession was handed over in 1991 and hence can gift tax be avoided?
can a son give gift to his father,will taxable in father,s income
can i get a gift of ‘CAR’ from my friend and can i avail exemption of Rs. 50000 as per the CBDT Notification dated 30 sept. 2009?
CAN SOMEONE AVAIL THIS EXEMPTION IF HE GETS GIFT OF CEMENT WORTH 1 LAKH RUPEES FROM HIS FRIEND?
My husband wants to gift a site to my daughter. the value we paid of the site is about rs.300000]- this amounts to gift
from a father to a daughter without taking any consideration.
please let me know is she to pay any tax by adding the value of the site to her income for that particular financial year?
janaki
Is it possible to add spouse name to home registration in India ? how much will it cost ?
I bought a flat in pune in yr 2010 got possession. the flat was registered on me and my father’s name since iam nri i made him co owner do that he coudo the documentation etc. i cleared the loan by funding myself and now the flat is free of mortgage. now my father wants to transfer his share to my wife. how will this be fone? I guess gift deed. how.much stamp duty will be applicable? How can i avoid stamp duty?
I purchased house of 4000SQF and constructed 4 story commercial complex each floor consisting average 2000SQF. I want to gift 2nd and 3rd floor to my son and daughter in order to get ride of service tax problems. I am a muslim family. Is registration is necessary for such gift if so what are the expenses i have to bear. Is my son or daughter has to pay any tax such as gift tax upon such propoerty. Kindly clarify