ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A gift can be a transfer of movable or immovable property or transfer of money from the giver to the recipient. Gifting is often used to transfer property or money within the family or to relatives by way of will or inheritance.

Detailed explanation-2: -A transfer payment is a payment of money for which there are no goods or services exchanged. Transfer payments commonly refer to efforts by local, state, and federal governments to redistribute money to those in need.

Detailed explanation-3: -all gifts are charged to tax Hence, if the aggregate value of gifts received during the year exceeds Rs. 50, 000, then total value of all such gifts received during the year will be charged to tax (i.e. the total amount of gift and not the amount in excess of Rs. 50, 000).

Detailed explanation-4: -Gifts from relatives are not taxable under the Income Tax Act. As per the Income Tax Act, the following list of persons is defined as a relative of an individual. Hence, only money received from the following persons will be exempt from income tax for an individual taxpayer.