My daughter in-law wants to offer a gift of ₹15 lakhs to her mother by withdrawing from her PPF account which is maturing. Will this transaction entice any tax obligation for my daughter or her mother? Can her mother make investments this amount inside the Senior Citizen Saving Scheme as she is a senior citizen? Will this current from daughter to mother, should be documented by the use of a gift deed on a stamp paper and notarized sooner than exact money is transferred from daughter account to mother account?
After abolition of the Gift Tax Act, the obligation to pay tax on current is on the recipient of the current and the donor would not have any tax obligation. A recipient of a gift is required to pay tax if the mixture of the entire presents acquired all through one financial 12 months exceeds fifty thousand rupees in a 12 months. So presents upto fifty thousand rupees together in a financial 12 months are to not be dealt with as income of the recipient nonetheless as quickly because the brink of fifty thousand rupees is crossed full price of current/s become taxable. There are certain exceptions to this rule of taxation of presents. For occasion, presents acquired from specified household collectively along with your children are to not be dealt with as a result of the income of the recipient irrespective of the price of the presents. So neither your daughter nor her mother can have any tax implication on this transaction of presents.
Your partner can use or make investments the money one of the best ways she wants. So she is going to make investments the money inside the Senior Citizen Savings Scheme as a result of the scheme would not stipulate any conditions about provide of funds for investments inside the scheme.
There is not any need in your daughter and her mother to execute any current deed on a stamp paper. Your daughter can ship a communication to her mother along with the cheque made out for the current. What is required is that the intention of your daughter to offer the money must be clear and her mother must accept the current. Without acceptance of current by the donee the transaction of current is incomplete.
(Balwant Jain is a tax and funding expert and could also be reached on [email protected] and @jainbalwant on his twitter take care of)
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Updated: 27 May 2023, 10:57 AM IST
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