Sending money back to parents... is not Taxable.. really.

#2
I came across this:

Shweta: I send a sizeable amount of money home every month. Can I claim my parents as my dependents? My dad is self-employed.
Shanbhag: Whether your parents are dependents or not, the money sent to your parents is tax-free for you as well as your parents.

taken this from. http://wealth.moneycontrol.com/showstory.php?id=8881&pg=5

Is this true...? Really.

Let me know on this.
Yes it's true. It'll be treated as a gift from the payer to his parents and hence will not be taxable in the hands of the parent. However, the son/daughter will have to pay tax on his total income including the amount gifted to parents whether dependent or not.
 
#3
Yes it's true. It'll be treated as a gift from the payer to his parents and hence will not be taxable in the hands of the parent. However, the son/daughter will have to pay tax on his total income including the amount gifted to parents whether dependent or not.
1st part is fine, the money sent to parents is taken as gift, But Mr shanbagh who I think is a known tax specialist is saying that it is also tax free in my hands, which is kinda awkward and can't be true...

Any other comments on this.
So Mr shanbag has definitely made a mistake. rite..?
 
#4
mr.Shanbag & moneygurukul both are right.

payer has to pay tax on his total income. and after that he can do what ever he want to with the balance.

There is no tax gifts to close relatives, and hence, neither you nor your parents need pay any further Tax.

However, if you gift cash to a person who is not your close relative, the receiver has to include the gifts in his total income and pay tax accordingly.

For list of relatives, refer to Income Tax Act.
 
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