Are there any cases in which sum of money received without consideration, i.e., monetary gift received by an individual or HUF is not charged to tax?

Ans. If any sum of money is received on or after 01/10/2009 by an Individual or HUF without any consideration and the aggregate value of which exceeds Rs. 50,000 during the previous year, then the whole of the aggregate value of such sum is chargeable to tax.

However, in the following cases nothing will be charged to tax in respect of any sum of money received by an Individual or HUF without any consideration if the same is received:

• from any relative or by a HUF from its members; or
• on the occasion of the marriage of the individual; or
• under a will/ by way of inheritance; or
• in contemplation of death of the payer or donor as the case may be; or
• from a local authority as defined under Explanation to clause (20) of section 10 of the Income-tax Act, 1961; or
• from any fund, foundation, university, other educational institution, hospital or other medical institution, any trust or institution referred to in section 10(23); [w.e.f. AY 2023-24, this exemption is not available if a sum of money is received by a specified person referred to in section 13(3)]. or
• by any fund, trust, institution, any university, other educational institution, any hospital, other medical institution referred to in sub-clause (iv) or sub-clause (v) or sub-clause (vi) or sub-clause (via) of clause (23C) of section 10; or (applicable if the money is received on or after 1^st day of April, 2017)
• from or by a trust or institution registered under section 12A, section 12AA or ​ section 12AB [w.e.f. AY 2023-24, this exemption is not available if a sum of money is received by a specified person referred to in section 13(3)]. or; or
• by way of transaction not regarded as transfer under section 47(i)/(iv)/(v)/(vi)/(via)/ (viaa)/(vib)/ (vic)/ (vica)/ (vicb)/ (vid)/ (vii)
• from an Individual by a trust created or established solely for the benefit of relative of the Individual.  (applicable if the money is received on or after 1^st day of April, 2017)
• from such class of person's and subject to such conditions as may be prescribed.
• From any person, in respect of any expenditure actually incurred by individual on his medical treatment or treatment of any member of his family, for any illness related to COVID-19 (subject to such conditions as prescribed by Govt.).
• By a member of the family of a deceased person, if cause of death is illness related to COVID-19,:

- From the employer of the deceased person; or

- From any other person or persons to the extent that such sum doesn’t exceed Rs. 10 lakh.

Note: The member must receive the payment within 12 months from the date of death of such person and satisfy the following conditions:

(a) the death of the individual should be within 6 months from the date of testing positive or from the date of being clinically determined as a COVID-19 case;

(b) the family member of such individual shall keep a record of the COVID-19 positive report or medical report if clinically determined to be COVID-19 positive through investigation in a hospital or in an in-patient-facility by a treating physician of a person so admitted;

(c) the family member of such individual shall keep a record of a medical report or death certificate issued by a medical practitioner or a Government civil registration office, in which it is stated that the death of the person is related to COVID-19.

(d) the family member furnished a Statement in Form A providing the details of amount received during the year. The statement shall be filed within 9 months from the end of financial year in which the amount is received or 31.12.2022, whichever is later.