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Gift from relative

priya (article) (154 Points)

17 July 2012

CAN I KNOW THE PROVISIONS REGARDING GIFT FROM RELATIVE I.E. FROM BROTHER .IS IT IS TAXABLE?

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Pawan Mittal (CA Final) (711 Points)
Replied 17 July 2012

Gift from your brother if fully exempt from tax in the hands of both you and your brother.

As per the Income tax act, the Gifts received from any of your relatives are fully exempt from tax. Whether you are received the gifts as Cash, Cheque or any goods. You are not liable to pay the tax for these gifts. Here the “relatives” term defines by the Income Tax act as follows :

Spouse of the individual
Brother or sister of the individual
Brother or sister of the spouse of the individual
Brother or sister of either of the parents of the individual
Any lineal ascendant or descendant of the individual
Any lineal ascendant or descendant of the spouse of the individual,Spouse of the person referred to in clauses (ii) to (vi).

For example if you are receiving gift of Rs.100000 from your uncle ( your mother’s brother), it is fully exempt from the Tax. Whenever you get the gifts please apply the relations in the above list to ascertain whether you are liable to pay any tax for the received gift.

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