A gift is considered taxable in India under specific conditions related to its value and type.
Understanding Taxable Gifts
Gifts received by an individual or Hindu Undivided Family (HUF) without consideration (i.e., without making any payment in return) are generally taxable if their value exceeds certain thresholds, unless they fall under specific exemptions (e.g., gifts from certain relatives, gifts received on the occasion of marriage).
Here are the primary types of gifts that are considered taxable based on their value:
| Type of Gift | Applicability of Gift Tax |
|---|---|
| Cash, Cheque, or Bank Transfer | If the aggregate value of such gifts received during a financial year exceeds ₹50,000. |
| Immovable Property (such as land, building, etc.) without consideration | If the Stamp Duty Value of the gifted immovable property exceeds ₹50,000. This applies when the property is received without payment. |
Practical Insights
- Valuation: For cash or monetary gifts, the value is straightforward. For immovable property, the Stamp Duty Value is used to determine taxability.
- Aggregation: For gifts of cash, cheque, or bank transfer, the total sum received from all non-exempt sources in a financial year is considered. If this aggregate crosses the ₹50,000 threshold, the entire amount exceeding ₹50,000 becomes taxable.
- Consideration: The term "without consideration" is crucial. If a property is transferred for a value less than its Stamp Duty Value, the difference might also be considered a taxable gift if it exceeds the specified limit.
