Income Tax: You do not have to pay tax on gift received on marriage or by will

Income Tax: You do not have to pay tax on gift received on marriage or by will

Q1. In a gift deed, does one have to pay tax to the government? —Pramod Lele

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A gift received under certain specified circumstances (such as occasion of marriage from a relative/non-relative or by way of will/ inheritance, etc.) is not subject to income tax. Relative for this purpose has been defined under income tax provisions. Apart from those specified circumstances, any money/ property received without any consideration or for inadequate consideration is subject to income tax as ‘income from other sources’.

Q2. My son worked for a year in Hyderabad and then went to the US for higher education. Will he have to file income tax returns? —V N Nair

Income tax return has to be filed only for the year during which your son earned any taxable income. In absence of any taxable income or if such taxable income is below the basic exemption limit (i.e. `2,50,000), no income tax return is required to be filed.

Q3. I got a notice for defective returns six months back. I refiled it, but last month again got a notice of defective returns. What should I do? —Akash Kumar Majhi

It would be important to first understand the reason why such notices for defective return are being issued. Any curative action or refiling of return may be advised only after understanding such reason. If such defect can not be rectified for any reason beyond control of assessee, then necessary application may be required to be made to concerned tax authorities explaining the difficulty and request them to consider the return as ‘valid return’. Help of a professional chartered accountant or tax practitioner may be taken in such matter.

Q4. I have sold my house and invested the sum in tax savings bond. Do I have to pay long-term capital gains tax? —Dheeraj Singh

If the entire amount of long terms capital gains has been invested in eligible tax savings bonds (such as bonds of Rural Electrification Corporation, National Highways Authorities of India, or any other bond notified by the Central government for this purpose) within six months from date of transfer of house, then no further payment of income tax would be required.

However, other conditions (such as lock-in period of such investment in tax savings bonds, etc.) will need to be complied with. It may also be noted that maximum Rs 50 lakh can be invested in such bonds in any financial year.

 

 

Source by:-financialexpress

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