NRI's CORNER
F.E.M.A.
GIFT TAX
NRIs CORNER - GIFT TAX

Gift-tax :
Gift Tax has been abolished in India since 30.9.1998. Hence, there is no gift tax whatsoever for any gift including gift of immovable property.
However amounts of gifts exceeding Rs.50,000 received from persons who are not covered by the definition of 'close relative ' are to be taxed as taxable income in the hands of the donee.
However, with effect from 1st October 2009, amount  of gifts exceeding Rs. 50,000/- received from a person who is not a close relative of the donee, is to be included in taxable income of the donee.  As such, donee is required to pay income tax on the amount of gift or market value of movable properties.

Provided furtherthat this clause shall not apply to any sum of money or any property received
(a)         from any relative; or
(b)         on the occasion of the marriage of the individual; or
(c)         under a will or by way of inheritance; or
(d)         in contemplation of death of the payer or donor, as the case may be; or
(e)         from any local authority as defined in the Explanation to clause (20) of section10; or
(f)           from any fund or foundation or university or other educational institution or hospital or other medical institution or any trust or institution referred to in clause (23C) of section10; or
(g)         from any trust or institution registered under section 12AA.
Explanation. For the purposes of this clause,
(a)         assessable means the price which the stamp valuation authority would have, notwithstanding anything to the contrary contained in any other law for the time being in force, adopted or assessed, if it were referred to such authority for the purpose of the payment of stamp duty.
(b)         fair market value of a property, other than an immovable property, means the value determined in accordance with the method as may be prescribed;
(c)         jewellery includes-
a.)         ornaments made of gold, silver, platinum or any other precious metal or any alloy containing one or more of such precious metals, whether or not containing any precious or semi-precious stone, and whether or not worked or sewn into any wearing apparel;
b.)         precious or semi-precious stones, whether or not set in any furniture, utensil or other article or worked or sewn into any wearing apparel;
(d)         property means
                                        (i)       immovable property being land or building or both;
                                       (ii)     shares and securities;
                                     (iii)       jewellery;
                                     (iv)       archaeological collections;
                                     (v)        drawings;
                                    (vi)       paintings;
                                   (vii)       sculptures; or
                                  (viii)      any work of art;
(e)         For the purposes of this clause, relative means
                                     (i)        spouse of the individual;
                                    (ii)        brother or sister of the individual;
                                   (iii)       brother or sister of the spouse of the individual;
                                    (iv)       brother or sister of either of the parents of the individual;
                                     (v)       any lineal ascendant or descendant of the individual;
                                    (vi)       any lineal ascendant or descendant of the spouse of the individual;
                                   (vii)      spouse of the person referred to in clauses (ii) to (vi);
(f)            stamp duty value means the value adopted or assessed or assessable by any authority of the Central Government or a State Government for the purpose of payment of stamp duty in respect of an immovable property.
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