A) You are not liable to pay Gift Tax for the following gifts made by you:
* Gift from NRE/NRNR/FCNR account to any person
* Gift of Convertible foreign exchange to any relative
* Gift of foreign exchange assets:
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Shares in Indian companies
- Debentures issued by an Indian Public Limited Company.
- Deposits in an Indian Public Limited Company
- Any security of the Central Givernment
- Any other notified assets.
* Gift of special Bearer Bonds, 1991 to any person
* Gift of immovable property sitauted outside India to any person.
UPDATE !! In major post-budget change, the government of India has withdrawn the proposal to tax gifts as income of the recipient. Since he had already abolished gift tax on the donor of gifts as part of his budget proposals, this withdrawl effectively means that gifts made on or after October 1,1998 shall be free from any tax either on the donor or donee.
Q2) What is the procedure of gifting moveable property to any person ?
A)The donor should ensure that the gift is located outside India at the time of gifting. It is further advised that the donee should receive the gift in India or through his agent outside India. If the gift is a cheque sent by post or through any other agent, the donor should do so at the request of the donee receiving the gift in India. A written request to this effect should be taken from the donee.
Q3) What is the threshold limit for gifts other than exempt gifts ?
A) The threshold limits for gift tax is Rs.30,000/- for each financial year. If the gift exceeds that amount, the donor has to pay gift tax at the rate of 30% for the amount in excess.
