ITR filing: Gifts from friends and family tax rules explained

Gifts received from friends or family may be taxable under Section 56 of the Income Tax Act and must be reported in the income tax return.

Exempt gifts include those from relatives, gifts up to ₹50,000 per year from non-relatives, inheritance, and wedding gifts.

Taxable gifts must be disclosed under the head 'Income from Other Sources' in the same financial year they are received.

Non-taxable gifts now have a new reporting field in the ITR to maintain compliance.

Failure to disclose high-value gifts can lead to scrutiny and penalties of 50% to 200% of tax payable.