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Section I: Income Tax and You
  • Ques: Amount above Rs. 50,000 received from non-relatives is taxable
  • Ans: If you receive more than Rs. 50,000 during the financial year without any consideration, then the entire sum is taxable, provided it has been received from any source(s) other than the ones mentioned below:
    • On the occasion of marriage
    • Under a will or by way of inheritance
    • Gift from a relative
    • In contemplation of death
  • The limit of Rs. 50,000 is for the entire financial year (Apr 1, 2007 to Mar 31, 2008), irrespective of the number of persons from whom you have received the money. For e.g., if you received Rs. 10,000 from six persons, then you will have to pay tax on the entire sum of Rs. 60,000.
  • A gift received in kind, such as bonds, debentures, and jewellery, is not taxable. You do not need to report such gifts in your return.
  • In general, take above points in consideration before receiving or giving money (cheque or cash) to anyone other than a relative.
 
     
 
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