The term ‘immovable property’ includes land and buildings

Immovable property received an FY without consideration and whose stamp duty value exceeds Rs.50,000, is taxable in the hands of the recipient


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I have two apartments of which I want to gift one to my daughter. What will be the tax treatment?

—Gyanesh J.

Immovable property received by an individual from any person during a financial year (FY) without consideration and whose stamp duty value exceeds Rs.50,000, is taxable under the head ‘income from other sources’ in the hands of the recipient. The term immovable property includes land or building or both.

However, an exemption is available if the property is received from a relative, who include, among others, the individual’s parents.

Accordingly, there should not be any tax implications in your daughter’s hands if such a property is gifted to her. Please note that any subsequent income from letting out the apartment or its sale shall be taxable in your daughter’s hands as ‘income from house property’ or as capital gains depending on the nature of income.

You shall not be taxed on the above gift transaction.

With respect to the above transaction, it would be advisable to have the relevant documentation in place to substantiate the genuineness of the transaction.

I pay the health insurance premiums for myself and my parents. Am I eligible for a tax benefit on both the payments?

—Kushal Midha

An individual can claim tax deduction from total income in respect to payment made towards health insurance premium under section 80D of the Income-tax Act, 1961.

The deduction from total income can be availed towards payment of health insurance premium for self, spouse, dependent children and parents subject to prescribed conditions.

For individuals who are below the age of 60 years during the FY, the tax deduction is restricted to Rs.25,000 (including up to Rs.5,000 towards preventive health check–up) for the year for oneself. An additional deduction of Rs.25,000 could be availed for payment of health insurance premium for parents.

If your parents are resident senior citizens (age 60 years or above during the FY), the deduction is restricted to Rs.30,000 (including up to Rs.5,000 towards preventive health check–up) for the year. But the deduction towards premium is available only if it is paid by any mode other than cash.

Since you are paying towards health insurance for self and parents during FY16, you can claim tax deduction for the medical insurance premium subject to the aforesaid prescribed limits.

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