Received gifts? Don't forget to declare in Income Tax Return

From the tax year 2017-18, it has became mandatory to disclose the gifts you receive. Until last year, there was no such compulsion. Initially, under Gift Tax Act 1958, tax was levied on gifts in the hands of the donor. The law was abolished in 1998. It was reintroduced in 2004 under the Finance Act 2004 and levied on recipient.
Here's a quick guide on how to declare gifts in income tax returns:

Gifts from Employer

On many occasions like birthday, performance excellence, employers gift the employee. Gifts below Rs 5,000 in aggregate during the financial year are exempted from tax. Above that amount, an employee is liable to be assessed for such gifts. These gifts -- items or cash -- are taxable as perquisites under the head 'Income from Salary'.

Other cash gifts

If one receives cash gifts from relatives and friends during a financial year, it is taxable as other income. If the value of such gifts is less than Rs 50,000, then it is exempted. Any amount more than this value is taxable.

Immovable property as gifts

If you get land or house as gift, you will have to pay income tax if the stamp duty value of the property exceeds Rs 50,000.
If immovable property is received "without consideration" and the stamp duty value of the property exceeds Rs 50,000, the stamp duty value of such property will be chargeable to tax.
If the property is received for a consideration and the actual buying cost is less than the stamp duty value of the property, then the difference between stamp duty value and consideration is taxable.
Here, consideration means the value of the property that changes hands between two or more parties.

Gold as gifts

Jewellery comes under the category of movable property. The taxation rules are similar to immovable properties. If a taxpayer receives gift or buys them at a price lesser than its fair market value (FMV), the value of benefits shall be taxed.
Other gifts

Paintings, drawings, shares and securities, archaeological collections, sculptures, bullion and any work of art are taxed similar to gold jewellery.  


You don't have to pay income taxes, irrespective of the value, if the money or property is received from a relative or under certain specified circumstances such as on the occasion of marriage, under a will or by way of inheritance.
Disclosure of Gifts in ITR

All gifts received shall be disclosed as taxable income in the ITR form under the Schedule Salary or Schedule OS, depending upon the nature of the gift.
Although ITR 1 and ITR 4 tax forms don't specifically require disclosure for taxable gifts, ITR 2 and ITR 3 mandate disclosure of taxable movable/immovable properties received as gifts during the year. Exempt gift could be disclosed in schedule EI (Exempt Income).