Gift & savings bank bccount interest taxation
**zubair**
(Querist) 14 April 2014
This query is : Resolved
Few months back I deposited Rs. 40000/- cash in my fathers savings bank account as a gift. 1) Do I need to sign a gift deed since it is cash deposited by me in my fathers account. 2) Is cash gift from son to father is exempted from income tax for father. 3) If it is exempted and since it is more than Rs. 5000/- do my father need to fill the ITR-2 form to claim the exemption. 4) The amount received as a gift and savings bank account interest, can it be shown under "Income From Other Sources" in ITR form.
R.V.RAO
(Expert) 15 April 2014
savings bank account interest upto Rs10000/-P.A is tax free. but one needs to show the same in one's IT return under income from other sources and claim tax exemption on such interest. same way cash gift also be shown as income from other sources and claim exemption.
gift tax between relatives is not taxed.(whether such gifts are in cash or in kind)
as for documentation, keep a record about details of cash gift on a piece of paper ,signed by both receiver and payer of cash,stating clearly their relationship,and that it is a cash gift and that the cash gift is accepted by the father.
since it is tax exempted and duly recorded, signed by both, for any future reference, no need to register the gift deed.
the payer of gift be prepared to answer the sources of such cash gift.
malipeddi jaggarao
(Expert) 15 April 2014
Agreed with Mr.R.V.Rao.
1) Not necessary.
2) Yes
3)If your father is Income Tax Asseess and filing returns, he can mention this amount as income from other sources. If is not filing returns, he can ignore.
4)Yes.
Rajendra K Goyal
(Expert) 15 April 2014
Well advised by the experts, agree to it.
T. Kalaiselvan, Advocate
(Expert) 15 April 2014
