Income Tax on Cash Gift to Wife
cash gift up received above Rs 50,000 from non relatives will attract income tax
How much cash can be received by Wife from Husband ?
However, in case of cash gift from husband, there is no such limit on how much cash can be gifted without tax implications.
In other words, a man can gift any amount to his wife without any tax implication in her hand.
In normal circumstances, cash gifts above Rs. 50,000 are subject to tax in the hands of recipient. However, such threshold limit is not applicable in case the cash gift is received from a specified relative (which includes spouse) under section 56(2)(x) of the Income Tax Act (‘IT Act’).
Thus, cash gift by a husband to his wife would be exempt from tax irrespective of the quantum in accordance with Section 56(2)(x) of the IT Act,”
How Much cash can be given to wife
As per the tax laws, any person cannot receive more than Rs 2 lakh or above in cash from a person in a day or for a a single transaction.
Thus it is be advisable to restrict your cash gift to Rs 2 lakh.
Section 269ST prohibits any person from receiving any amount of Rs. 2 lakhs or more in aggregate from a person
- in a day or
- in respect of a single transaction or
- in respect of transactions relating to one event or occasion from a person etc.
Income Tax on income from cash gift received by Wife
Cash gift will be tax-free in the hands of wife in , but any income from such investment of such amount would be taxable in the hands of the husbands.
It is pertinent to note that though the cash gift is tax free in the hands of the wife, any income accrued on such cash gift amount would be subjected to clubbing provisions u/s 64(1)(iv) of the IT Act and accordingly taxed in the hands of the husband