Valentine’s Day has become a marketing blitz day . In other words, different merchandise lines up their product for special sale on the valentine’s day. So , at least a month before the actual day ( 14th February) , the advertising for different types of gifts – from a greeting card to platinum and diamond jewellery – take the lime light on internet, T.V and print media. So , where does the Income Tax Act fits in all these romantic day celebration. So, here is a fun posting reminding all valentines there who are planning to give expensive gifts to the loved ones , then spare some moment for thought on the taxation angle to the gift , because government wants its share out of your gift.
Valentine’s Day Gift : When Taxable ?
If the valentine is anyone other than your spouse and you are giving gift in excess of Rs 50,000, the value of the gift shall be taxable income in hand of recipient as per section 56(2)(vi) of the Income Tax Act . So, safest from taxation angel is your spouse.
However, if there is no income of the person for the year and such valentine is also not your relative, you can actually give gift upto Rs 2,00,000 as the Income Tax Act imposes tax only above RS 2,00,000 of income in case of individual. So , even if the valentine’s gift value is added as income u/s 56(2) in hand of recipient , if that is the sole income, no tax will be required to be paid on such gift.
The purpose of this article was just to highlight a law which affects their sentimental and emotional step which many take on the day of valentine’s day.
Happy Valentine Day !