Gift tax on Rewards for entrance exam toppers

As per the current tax law, any person (donee / recipient) receiving a sum of money, or an immovable property or any other specified property from any other person (donor) without consideration or for an inadequate consideration i.e. less than the fair market value of the property or stamp duty value in case of an immovable property, is liable to be taxed on the value of such gift.

• So the tax in case of money/immovable property will be paid by student. Monetary gifts would include gifts in cash, cheques, bank deposits, draft, etc. Any such gift would be taxable in full in the hands of the recipient if it exceeds 50,000 during the financial year.
• If a person gets a gift (whether car or anything else), from a person other than his relative, it is always taxable on Fair Market Value above Rs 50,000.

Originally posted by : ravinderyadavp1995@gmail.com
	Hi all,is the gift tax applicable on the rewards given to entrance exam toppers like GATE,IIT JEE etc.? if yes, who pay the tax, is it student or institute??if the reward is car, then how the tax is applicable??also if it is cheque, will it be TDS i.e. tax deduction at source??thanksRavinder

Yes TDS will be applied(institute)

and tax  need to pay by student,after calculation by fair value theory.

Hi

Thank you for asking this question

Monetary gifts would include gifts in cash, cheques, bank deposits, draft, etc. Any such gift would be taxable in full in the hands of the recipient if it exceeds 50,000 during the financial year.
According to your question- Tax will be paid by student.

If reward is a car  then also on its fair value tax will be levied..

Hope this will help you

Best regards

Akshay Gupta