I have received tax free 50 Lacs on account of agriculture land acquired by government of India and I want to give to my spouse. on this value she is liable to pay tax.
And my wife want gift this amount to her sister, her sister has to pay tax on the amount gifted by her sister
| Originally posted by : VIKRAM | ||
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I have received tax free 50 Lacs on account of agriculture land acquired by government of India and I want to give to my spouse. on this value she is liable to pay tax.And my wife want gift this amount to her sister, her sister has to pay tax on the amount gifted by her sister |  |
As you already said that the funds you received from GOI are tax free (hope you have already confirmed about this issue and applicabilty of this in your case...so will not go into further details ) ... YES you can gift any amount out of this received amount to your wife , gifted amount will be tax free in her hands BUT any income generated out of this gifted amount will be clubbed with your income (IT Act clubbing provision) and will be taxable in your hand only ...
now the twist comes...as you said that you first want to gift the amount to your wife then again she will gift the amount to her sister ...YOU NEED NOT TO DO THIS as your wife`s sister already falls under " relative category " as per section 56 of IT act , so you can gift the amount directly to her ...also no income clubbing provision applicable between you and your wife`s sister .... win win situation for you....
CAclubindia
