kollipara sundaraiah asked 1 year ago
It person estimated profit declared rs:8 lacs f.y. 22-23.but assessee cash gift to brother rs:15 lacs through on bank online mode pay f.y.22-23.
Doubt:
Assessee gift amount rs:15 lacs -profit declared amount rs:8 lacs difference amount rs:7 lacs tax applicable in it act.
Sonu answered 1 year ago
Profit declared in FY 22-23 is 8 lakh.
Cash gift to brother (online mode) Rs. 15 lakh.
Is the difference taxable.?
Please note that income tax is applicable on income and not on wealth.
A person may be having 10 crores in his bank account. and earning only 7 lakh per year at interest income. Then income tax is not applicable in 10 crores but only on 7 lakhs. Further, He may gift this 10 crore to his relative but still income tax is not applicable on this 10 crore.
Hence in your case, income tax is not applicable on the difference or gift amount.
Further please note that gift from a relative is exempt. Hence this gift money of 15 lakhs is not even taxable in the hands of the brother of the assessee (i.e. gift receiver). But when he invests this 15 lakh and earns some income,….only then income tax is applicable on the income part (in the hands of his brother). Further please note that the clubbing provisions are not applicable to money given to the brother.