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CA Intermediate · Taxation · Income from Other Sources

Meera Iyer, a resident individual, received a gift of Rs 40,000 in cash from her friend on her birthday during tax year 2026-27. She received no other gifts during the year. Which statement is correct about the taxability of this receipt as income from other sources?

The Rs 40,000 gift is not taxable. Money received without consideration by an individual is taxed under income from other sources only when the aggregate of such sums in the tax year exceeds Rs 50,000. Since Rs 40,000 is below that limit, nothing is chargeable, whether or not the donor is a relative.

  1. AEntire Rs 40,000 is taxable because it is received in cash
  2. BRs 40,000 is not taxable because aggregate sum received without consideration does not exceed Rs 50,000Correct
  3. COnly Rs 10,000 is taxable, being the excess over Rs 30,000
  4. DRs 40,000 is taxable because the donor is not a relative

Explanation

Money received without consideration is taxable only if the aggregate in the tax year exceeds Rs 50,000. Here the aggregate is Rs 40,000, so nothing is taxable. Option A is wrong because mode of receipt is irrelevant, and C invents a basic exemption-type threshold.

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