5

I want to give rs.1lacs (100,000 rupees) to my sister's son who resides in the UK as my sister died recently and he has no father. My sister's son is an adult and is earning. So is this gift taxable to me or him? If so how do I calculate it?

6

The UK doesn't have a gift tax. In limited circumstances if the giver is also in the UK and dies within 7 years, then some inheritance tax might be payable, but if you're in India that won't apply.

India also appears not to have any gift tax if the giver is an uncle of the recipient, so no tax will be payable by either party here.

There's also no tax deduction for gifts in either the UK or India, so if this is out of your income you'll probably already have paid tax on the money in some form.

  • 1
    The important point to make to Indians is that there is no deduction from taxable income for the gift that is given, whether to a close relative (in which case no gift tax is due for a gift to a sister's son) or to a more distant relative such as a cousin-sister's son or to a stranger (in which case gift tax is due from the donor if the gift exceeds INR 5000); the taxable income is the same regardless of whether the gift is given or not. But I gave the gift from the salary that I earned that year. DonI still have to pay tax on that part of the salary? Yes you do. – Dilip Sarwate Feb 19 '17 at 20:38

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.