Deliverables

Resident Indian gives a gift to an NRI – Let us look at the different scenarios when an NRI receives a gift from a Resident Indian – A gift to NRI Relative is exempted from tax – When a resident Indian gives a gift in the form of cash, cheque, items, or property to an NRI who is a relative, both giver and receiver are exempt from Gift tax in India. When a resident Indian gives a gift in the form of cash, cheque, items, or property that is within the value of Rs. 50,000 to an NRI who is not a relative, both giver and receiver are exempt from tax in India. When a resident Indian gives gifts in the form of cash, cheque, items, or property that exceeds the value of Rs. 50,000 to an NRI, who is a non-relative, the India gift tax NRI is payable by the receiver. The amount is added to the receiver’s income and taxed as per the income tax slab applicable to the receiver. The maximum limit for such a gift is USD 250,000 in one financial year. [This limit is defined under LRS (Liberalised Remittance Scheme) – the total amount of foreign exchange purchased from or remitted through, all sources in India.] When a resident Indian gives gifts in the form of cash, cheque, items, or property to an NRI for marriage or through will, both giver and receiver are exempt from tax in India irrespective of the ‘relative’ status. When a resident Indian gives a gift in the form of shares or securities of an Indian company, the total value cannot exceed USD 50,000 in one financial year. The gift should follow the regulations of RBI regarding NRIs holding stock in Indian companies. When you give a gift or get a gift, make sure you understand the rules regarding gifts and the tax implications and act accordingly. The information that I shared in the above post is one part of the story – issues can be complex based on your resident status. If we talk about the USA – you can gift up to $15,000 in a year. This is not that simple but just an example. So check the rules in the countries where you are staying.