India’s a country which is seeped in deep family traditions and values, and there are many festivals and occasions where family members give gifts to each other. One of the most common gifts in India is money, and there are several occasions where a member gifts his/her family member much money as a sign of affection.

However, the Government doesn’t allow you to gift as much as you want to your family members. Such common occurrences of the same will give rise to black money and other nefarious practices.

As per India’s IT laws, giving gifts might not be taxable, but receiving it could be. At least up to Rs. 50,000. If the total value exceeds this amount, you’ll need to pay a tax.

A common instance of this is when an individual receives money on their wedding day. Here, if the amount reaches Rs. 55,000, then the entire amount can be taxable. This tax must be paid as a self-assessment or advance tax before the IT return for the annual year.

The Gift Tax Act –

This tax on gifts was levied during the GIft Act of 1958 by the Government of India. It was repealed in 1998 and reintroduced after 6 years. As per the law that was last amended in 2017,

“gifts received by any person are taxed in the hands of recipient under the head’ Income from other sources’ at normal tax rates.”

What are the Specifics?

There are a few specific rules to the act –

  1. Gifts that have a value of up to Rs. 50,000 can be exempt from any form of tax. If you do receive gifts which exceed this particular amount, then the entire gift can be taxed.
  2. In case you receive property for no particular consideration, then the difference in the stamp duty value and the consideration is considered as taxable gifts.
  3. Gifts received from certain relatives are also exempted, and the amount is not even considered. These relatives include your spouse, brother, father, sister, and father, among others. It can also include ascendant and descendants from the lineal heritage or their spouse/sister or brother. While the gift is exempt for the recipient, any income tax generated due to the gift may be taxable under the Income Tax Act’s clubbing of income provisions.
  4. Gifts that are given during the marriage of the recipient are exempt from the tax.
  5. Any gift also given during the death contemplation of the donor or under inheritance or wills are also exempt.
  6. Any property acquired through local authorities is defined under section 10 (20) of the IT Act.
  7. Properties acquired through any foundation, fund, educational institution or university, medical institution or hospital are mentioned under section 10(23C)
  8. Also, properties that are received from an institution that is registered under Section 12AA or trust is exempted.


Finally, gifts such as gold, cash, paintings, real estate, or other valuable items are taxable. If the amount of money or gift value is not more than Rs. 50,000, it won’t be taxable.