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Tax on gift received by friend residing abroad

shikha (Articleship) (94 Points)

28 May 2014

resptected sir/ madame

i have a query related with the taxablity of gift received by friend who residing abroad. gift is received in cash. amount of gift is rs 78026. please tell me whether whole amount of rs 78026/- is taxable or only 28026/- [78026-50000] is taxable.

please reply as soon as possible

thanxs

shikha

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4 Replies

Harendra Kumar (Tax Advisor ) (1326 Points)
Replied 28 May 2014

In this regard gifted amount exempted only 50000/- and rest amount taxable.

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Nikhil Kaushik (Fellow CA) (85748 Points)
Replied 28 May 2014

I have to disagree with harendra..please note that whole of the amount is taxable. Once the gift amount exceeds Rs 50000, the whole of it becomes taxable. Please refer Section 56(2)(vii) " (vii) where an individual or a Hindu undivided family receives, in any previous year, from any person or persons on or after the 1st day of October, 2009,— (a) any sum of money, without consideration, the aggregate value of which exceeds fifty thousand rupees, the whole of the aggregate value of such sum;"

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Harendra Kumar (Tax Advisor ) (1326 Points)
Replied 28 May 2014

Sir,

Of, it's concept also keep in my mind. Thanking you your valuable opinion.

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Sudarshan Raghavan (Chartered Accountant) (108 Points)
Replied 28 May 2014

hello shikha,

entire amount of Rs.78026/- is taxable. for section 56(2)(vii), residential status is irrelevant. the given section is applicable irrespective of whether the donor or the donee is a resident or non-resident. however, the section specifically applies only to an individual or HUF.....it doesn't applu to other assessees like company, firm etc....

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