By Neeraj Agarwala
I want to give Rs 80 lakh to my daughter to purchase a property. Will she have to pay gift tax?
—Ramesh Mahandis
Gifts received by an individual from a specified relative are fully exempt from tax, regardless of the amount. Specified relative includes a parent, so the gift of Rs 80 lakh to your daughter will not attract any tax liability in her hands. To ensure smooth execution and proper documentation, execute a gift deed stating that you are gifting Rs 80 lakh to your daughter. This document acts as proof of the transaction. Transfer the funds through a banking channel (such as NEFT, RTGS, or cheque) directly into your daughter’s bank account to establish a clear audit trail. Retain copies of the gift deed, bank statements, and any communication related to the gift for future reference.
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I have a joint home loan with my wife. Can both of us claim income tax deduction?
—Arvind Kumar
Yes, both of you can claim a tax deduction of up to Rs 2 lakh each on the interest paid for the home loan, if you are both co-owners of the property and co-borrowers of the loan. The property must be self-occupied to claim the maximum deduction of Rs 2 lakh each. For let-out properties, there is no upper limit on the interest deduction, but the overall loss under “income from house property” is capped at Rs 2 lakh per person in a financial year. The deduction is allowed in proportion to the share of the loan repayment. If both of you are equally sharing the repayment, you can claim an equal deduction. Both of you can also claim a deduction of up to Rs 1.5 lakh each on the principal repayment under Section 80C.
I bought tax-free bonds from the secondary market six months ago at Rs 1,040 (face value is Rs 1,000). The bonds are maturing now. Will the interest be considered tax-free and will there be a short term capital loss of Rs 40 ?
—Dinesh Goyal
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The interest earned on tax-free bonds remains exempt from tax under Section 10(15)(iv)(h),
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