Transfeering big amount to brother's account

Querist : Anonymous (Querist) 04 January 2010 This query is : Resolved
Hi,

I want to help my brother monetary to buy a new house. I am confused as what is the best way to help him with money which is currently in my account.

Please suggest legally best way so that we need not to pay any tax on the same amount.

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Vineet (Expert) 04 January 2010
You can gift any amount to your brother. It does not attract any tax in your hands or in the hands of your brother. While advising this I presume that he is your real brother and not cousin.

Querist : Anonymous (Querist) 04 January 2010
Thanks for the quick response. Just a quick query on the same as what exactly we have to do to show this amount as gifted one. I mean as a process what should I do to transfer this amount to his account as a gift.

Raj Kumar Makkad (Expert) 04 January 2010
You should register a gift deed in the local office of the registrar wherein the entire facts should be mentioned clearly in the deed. It can be drafted even by you in simple language and it should be witnessed by 2 persons.

A V Vishal (Expert) 04 January 2010
You can execute a simple letter stating that the money is being gifted out of natural love and affection, there is absolutely no requirement of getting the gift deed(letter) registered, however, take sufficient care that the amount is transferred either through a account payee cheque/draft or is transferred electronically from your account to your brother's account.

Vineet (Expert) 05 January 2010
Agree with Vishal. No need for any formal gift deed. The amount should be transferred throgh formal banking channels to avoid any complications at a later date.