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Giving a gift to kin, give an
affidavit too
WSN Network
New Delhi: In a
development that would be of immense interest to Diaspora community,
the Indian law has been tweaked to now require an affidavit from you
if you give any gift in kind, valued at more than Rs. 50,000, to
your relatives.
The Central
Board of Direct Taxes has ruled that any such gift will be taxable
for the donee unless it is from relatives or given during occasions
such as marriage or by way of inheritance.
The donee has to
get an affidavit affirming the donor to be his mother, father,
brother, sister or any other relative so that at the time of
claiming exemption under the new arrangement, the income tax
assessment officer can have an on-the-spot verification.
An individual
could preferably get one affidavit listing all gifts taken in the
entire assessment year from different relatives or the same kin. The
affidavit would save IT assessees the hassle of proving that the
gifts, movable and immovable, were received or inherited from a
relative residing in any part of the world. It would also establish
the donee’s relationship with the donor.
The department
will not tax gifts received from a relative on the occasion of
marriage of the donee, under a will or by way of inheritance, in
contemplation of the death of the donor, from any local authority as
defined in Section 10(20) of the Act, from any fund or trust
established under Section 10(23C) and from any trust or institution
registered under Section 12AA.
Assesses will
have to file income tax dues on the value of the gift and disclose
its taxable value in the returns for the assessment year 2010-11.
Under the IT Act
1961, a relative is defined as a spouse, brother or sister, brother
or sister of the spouse, brother or sister of either of the parents,
any lineal ascendant or descendant and spouse of any of the
relatives.
14
October 2009
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