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Marriage Gift Tax: In India, especially in the Northern regions, there is conspicuous consumption during the time of marriage. Now-a-days, a lot of money is being forked out for marriages. Parents and relatives of the bride and groom shower them with gifts worth crores and in some instances, cash is showered in the tune of lakhs in a platter. The gifts can be in form of money, cars, properties and other valuables. As per the income tax rule, if one receives gifts exceeding Rs 50,000 in a financial year in the form of cash, property or any other means, there will be taxation on it. However, in the case of marriage, the gifts do not entirely fall under this limitation. Let’s explore what is the tax regulation on gift received during marriage.All the gifts that the parents of the bride and groom receive during a wedding ceremony are exempt from tax. This includes gold, real estate, and other valuables. Taxes do not need to be paid on any of these assets. But let us inform you that gifts received by the parents of the bride and groom are excempt from tax. Suppose a parent receives a gift worth 1 lakh rupees, then he or she will be subject to tax.
Unlimited Value for Gifts
Tax regulations do not limit the amount of gifts accepted and shared during a wedding ceremony. Any guests attending the wedding are allowed to offer gifts without restriction to quantity or value, and will not be taxed. Though the person gifting such assets will need to clarify to the Tax authorities how he or she obtained the funds.
Is there a tax obligation for gold received as a gift during marriage?
As per the income tax provisions, any gold or jewelry gifted to a woman by her husband, brother, sister, or her parents and in-laws after the marriage is exempt from tax. However, there is a clause which says if a non-relative gives more than Rs 50,000, then tax payable on such gift. In this scenario, there is a special rule that if the gift is offered during marriage no matter who the giver is, it will be exempt from tax. This exemption can only be claimed once during marriage, not afterwards.
What is the maximum amount of gold you can possess without any documentation ÷
Under the Indian law, a woman with marital status can possess up to 500 grams of gold without any document. Unmarried woman can possess 250 grams of gold. Also men can only possess 100 grams of gold without any documental prove.
Do not take more than 2 lakh INR in cash
Do not accept more than 2 lakh INR in cash gifts. If a person accepts two lakh INR or more in cash, a penalty will be charged. So, if you are receiving a gift of 2 lakh, then it is better to receive it through banking channels, such as: A/C Payee cheque, A/C Payee bank draft, or transfers through electronic clearance system. If the payment is being received via self-cheque, then that will also be treated as a cash transaction and a penalty will be charged.
