One of my clients has during the financial year 2012-2013, in his "individual Status", made cash gifts of Rs.20lakhs and Rs.25lakhs respectively to his son's "individual" and "HUF" status. What is the tax implication of income from gift u/s 56 of the Incometax Act for the asst.year 2013-2014?
07 October 2013
Gift received from relative as well as HUF is exempt from Tax,
The Finance Act, 2012 has widened the definition of relative under Section 56(2)(vii) by providing that in case of a Hindu Undivided Family, any member thereof shall be treated as a relative. Therefore, an HUF can now make or receive gifts, to or from any of its members, without attracting any liability for income-tax.
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