Raksha Bandhan 2023: Is gifting cash to your sister taxable? Income tax rules explained here

• August 31, 2023
• CA Chandan Agarwal's Office

Raksha Bandhan 2023: The gifts are taxable in the hands of the recipient under Section 56(2)(x) but gifts from certain specified relatives are outside the scope of this provision

Raksha Bandhan 2023: Raksha Bandhan, the beautiful festival celebrates the bonding between the siblings. Rakhi remains incomplete without gifts. However, the trends are changing with time. But one thing that has remained constant is the cash, the money that brothers tend to gift to their sisters. So, how much money can you give your sister on Raksha Bandhan 2023? Is it taxable? What does the income tax rule say?

There is no limit on the amount of gift given to the relatives who are ascended or descended, lineally. Since your sister shares the same bloodline as yours. “Any gift given to you to your sister is neither taxable in your hand nor in your sister’s hand,” said Archit Gupta, Founder and CEO, Clear.

There is no limit up to which a person can give a gift to another person either under the income tax laws or any other law. Likewise, there is also no limit to which a person can give a gift in cash. “However, there is a limit of ₹2 lakh beyond which one cannot accept cash from any person for any transaction including gift on one occasion,” said tax and investment expert Balwant Jain

In case the amount is more than ₹2 lakh, Jain suggested carrying out the transaction through banking channels in order to comply with the law.

“The gifts are taxable in the hands of the recipient under Section 56(2)(x) but gifts from certain specified relatives are outside the scope of this provision,” added Balwant Jain.

Can you transfer your share/stocks to your sister? What is the procedure?

Yes, shares can be transferred to your sister without any repercussion of taxes, said Archit Gupta.

Raksha Bandhan 2023: Date, time, muhurat

There is a lot of confusion about the most auspicious time to tie Rakhi this year as the festival is celebrated on two days- August 30, and August 31

This year Raksha Bandhan will be celebrated on Wednesday, August 30.

Best time to tie Rakhi on August 30- After 9:01 pm

Best time to tie Rakhi on August 31- Before 7:05 am

Source: https://www.livemint.com/money/personal-finance/raksha-bandhan-2023-is-gifting-cash-to-your-sister-taxable-income-tax-rules-explained-here-11693377401048.html