During Diwali, gifts are given to their dear ones. Even some companies give bonuses to their employees. While one loves to receive gifts, however, a very common concept that income taxpayers need to understand is the taxability of gifts.
Diwali is just around the corner and Indian citizens are already preparing for a long holiday. The festival of lights is one of the major celebrations in the country. During Diwali, gifts are given to their dear ones. Even some companies give bonuses to their employees. While one loves to receive gifts, however, a very common concept that income taxpayers need to understand is the taxability of gifts. Whether be a Diwali bonus or monetary gifts, they are liable for taxes.
As per Income Tax guidelines, from the taxation point of view, gifts are classified as — any sum of money received (monetary gift); specified movable properties (gift of movable property); specified movable properties received at a reduced price (i.e. for inadequate consideration); immovable properties received without consideration (gift of immovable property); and immovable properties acquired at a reduced price.