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As a non-resident Indian (NRI), you might earn income from various sources in India. While you may know about taxes on salary, business income, or rental income, you might not be aware that gifts can also be taxable.
The Indian government introduced gift tax in 1958 to tax gifts exchanged in specific situations.
A gift is generally money, an asset or property you receive from someone without needing to pay it back.
Under the Indian tax law, gifts can include:
For NRIs, any income earned or received in India is generally taxable.
Gift tax in India depends on your relationship with the person giving the gift (relative or non-relative), as well as the item gifted, the value, and the purpose of the gift.
| Gift type | Tax rules |
|---|---|
| Money (cash, cheques or bank transfers) gifts over INR50,000 | Taxable for the recipient |
| Money (cash, cheques or bank transfers) gifts up to INR50,000 | Not taxable |
| Wedding gifts | Not taxable |
| Gifts from relatives | Not taxable |
| Gifts from specific trusts, funds, or educational institutions | Not taxable |
| Gift type | Money (cash, cheques or bank transfers) gifts over INR50,000 | Money (cash, cheques or bank transfers) gifts over INR50,000 |
|---|---|---|
| Tax rules | Taxable for the recipient | Taxable for the recipient |
| Gift type | Money (cash, cheques or bank transfers) gifts up to INR50,000 | Money (cash, cheques or bank transfers) gifts up to INR50,000 |
| Tax rules | Not taxable | Not taxable |
| Gift type | Wedding gifts | Wedding gifts |
| Tax rules | Not taxable | Not taxable |
| Gift type | Gifts from relatives | Gifts from relatives |
| Tax rules | Not taxable | Not taxable |
| Gift type | Gifts from specific trusts, funds, or educational institutions | Gifts from specific trusts, funds, or educational institutions |
| Tax rules | Not taxable | Not taxable |
| Gift type | Tax rules |
|---|---|
| Property from non-relatives | Taxable if value exceeds INR50,000 |
| Property from relatives | Not taxable |
| Shares or securities from non-relatives | Taxable if total yearly value exceeds INR50,000 |
| Shares or securities from relatives | Not taxable[@article-tax-securities] |
| Income earned from an asset (like interest or rent) | Taxable |
| Gift type | Property from non-relatives | Property from non-relatives |
|---|---|---|
| Tax rules | Taxable if value exceeds INR50,000 | Taxable if value exceeds INR50,000 |
| Gift type | Property from relatives | Property from relatives |
| Tax rules | Not taxable | Not taxable |
| Gift type | Shares or securities from non-relatives | Shares or securities from non-relatives |
| Tax rules | Taxable if total yearly value exceeds INR50,000 | Taxable if total yearly value exceeds INR50,000 |
| Gift type | Shares or securities from relatives | Shares or securities from relatives |
| Tax rules | Not taxable[@article-tax-securities] | Not taxable[@article-tax-securities] |
| Gift type | Income earned from an asset (like interest or rent) | Income earned from an asset (like interest or rent) |
| Tax rules | Taxable | Taxable |
See the government of India Income Tax Department Frequently Asked Questions for more information about taxable gifts.
Yes, in many cases. When you give a gift as an NRI, you need an NRI gift deed. This is a legal document required under Section 17 of the Registration Act, 1908. Both you and the person receiving the gift must sign this document on stamp paper.
Check your state's official portal to find and register a gift deed online.
Yes, NRIs can give money as gifts to people in India. These gifts must follow Indian tax laws and the rules of the Foreign Exchange Management Act (FEMA).
| Gift type | Tax rules |
|---|---|
| Gifts up to INR50,000 | Not taxable for both parties |
| Gifts exceeding INR50,000 | Taxable for the receiver, at applicable tax rates |
| Gift type | Gifts up to INR50,000 | Gifts up to INR50,000 |
|---|---|---|
| Tax rules | Not taxable for both parties | Not taxable for both parties |
| Gift type | Gifts exceeding INR50,000 | Gifts exceeding INR50,000 |
| Tax rules | Taxable for the receiver, at applicable tax rates | Taxable for the receiver, at applicable tax rates |
| Gift type | Tax rules |
|---|---|
| Wedding gifts | Not taxable for both parties |
| Gifts given through a will | Not taxable for both parties |
| Gift type | Wedding gifts | Wedding gifts |
|---|---|---|
| Tax rules | Not taxable for both parties | Not taxable for both parties |
| Gift type | Gifts given through a will | Gifts given through a will |
| Tax rules | Not taxable for both parties | Not taxable for both parties |
Gifts to close family members like your spouse, parents, children, grandparents, or siblings are usually tax-free, with no upper limit.
Gifts to non-relatives worth up to INR50,000 in a financial year are not taxable. Anything over INR50,000 becomes fully taxable for the receiver. Always keep clear records and use bank transfers or cheques to document the gift.
As an NRI, it's important to understand the tax rules when giving or receiving gifts to or from Indian residents.
Open an NRO saving or current account to deposit your income in India, your foreign currency earnings, or any cash gifts in rupees.
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