Date:09/10/2009 URL:
http://www.thehindu.com/2009/10/09/stories/2009100952061100.htm
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Affidavit must for gift in kind, over Rs. 50,000, from kin
It must affirm that donor is related to donee
New Delhi: From now on, when you get a gift in kind, valued at more than Rs.
50,000, from your parents or other relatives, make sure you have a sworn
affidavit declaring the donor your kin.
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.
On-the-spot verification
"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," a senior IT official said.
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
official said.
The CBDT on September 30 notified that "with effect from October 1.... any gift
in kind, being an immovable property or any other property, the value of which
exceeds Rs. 50,000, will become taxable in the hands of the donee, being an
individual or a Hindu Undivided Family (HUF), as income from other sources..."
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.
- PTI
source taken from:
The Hindu
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