2 posts were merged into an existing topic: How are gifted shares taxed?
I have gifted 1 Lakh to my mother through online bank transfer. For the gift deed notarization, is there any specific stamp paper (like 50 rupees, etc.) which I need to purchase?
Hey @Sudarshan_Prasad,
The stamp paper value for a gift deed differs from state to state. I would recommend you connect with a legal advisor to know the exact requirements for notarization.
Hope this helps!
Hi @Divya_Singhvi ji,
- Lets say ‘my friend’ owes me Rs 4Lakh
My friend has 4 share of MRF and let us assume that as on 29April the price of MRF is Rs 1Lakh / share.
Purchase date of MRF shares: 29April 2020 at Rs 50,000 ( lockdown time)
Now I decide to transfer those 4 shares of MRF via CDSL as of 29April instead of money from him.
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Would I be taxed on those 4 shares of MRF just as those shares arrive in my Dmat on 30April even if I dont sell them on 30April?
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Would ‘my friend’ be taxed on those 4MRF shares?
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Lets say on 30 Apr 2026 I sell those 4MRF shares, would I be taxed at 30% tax slab ( my income slab)
Regards,
Punit
Hey @Punit_T,
As a friend is not covered under the definition of a relative as per the Income Tax Act, any gifts received from a friend would be taxable.
Even if you do not sell the shares, you’ll have to report the FMV of shares under ‘Income from other sources’ and the same would be taxable at your applicable slab rate.
Moreover, when you sell these shares, capital gains tax will be applicable based on the holding period which will be calculated based on what date your friend had originally bought the shares. In your case, as the shares were originally purchased in 2020, the gains would be long-term (holding period > 12 months) and will be taxed at 10%. As these are capital gains, they will be taxed at a special rate and not your normal slab rate.
No, in the case of gifts, the sender of the gift is not liable to pay taxes.
Hope this clarifies.
The tax implications of gifting shares and claiming LTCG (Long Term Capital Gain) benefit depend on various factors and are subject to tax laws in your jurisdiction. Generally, if you gift shares to a family member, the recipient would be liable for any gains upon selling those shares, and they may claim the LTCG benefit if applicable. However, tax laws often have specific provisions regarding gifts and transfers of assets, so it’s crucial to consult with a tax advisor or legal expert for personalized advice based on your circumstances.
Regarding off-market transfers without paying Securities Transaction Tax (STT), such transfers may attract capital gains tax at a rate of 20% on the profit made from the sale of shares. Again, tax laws vary by jurisdiction, so it’s essential to consult with a tax professional to understand the specific tax implications of off-market share transfers in your country.
Gifts receeived on 2nd hindu marriage
Are tax free ?
Gifts received on 2nd muslim marriage
Are tax free ?
2nd marriage also and 3rd marriage also ?
what if someone marry and divorce and re-marry ?
Hey @HIREiN
In Income tax act, gifts are not taxable is received on the occasion of marriage. There is no specific provision regarding second/third marriage and thus gifts received on ‘n’ number of marriage of the person would not be taxable.
Hey team, Person A has 100 shares at 100rs per share he/she gives 50 shares when the share is 150rs with 50% profit to relative like wife/mother/father/daughter within 1 month of purchase with profit exceeding 50k to Person B . Now who has to pay STCG ? and the person B if they redeem it in few days what is the tax implications and the Person A is under non taxable income which means they are under regime slab .
Hey @Tinkle,
If the shares are being transferred as a gift, for relatives, gifts are exempted from taxes.
Hence, when these shares are being gifted neither the sender nor the receiver needs to pay taxes on it.
Now, when the shares are sold, capital gains will arise in the hands of the receiver, i.e. person B in your case. They will have to pay taxes on the gains based on whether the gains are short-term or long-term.
Here’s a detailed thread about tax implications on gifted shares, do give it a read. How are gifted shares taxed?
Let me know if you have any further doubts.
You’re absolutely correct but when Person A sells the share he/she had 50% profit which exceeds 50k but when they sell to Person B and Person B sells with 5% profit which is less than 10k .
But if you look on Person A trade book they have unreaslised profit of 50% which shows but if you see person B there is only 5% profit so both are tax excempted? in case Person B bought at higher price i.e 150rs but 100 is the buy price Person A bought so who needs to pay or it is excempted?
Hi @Tinkle,
When Person A gifts the shares, they’ll not incur any capital gains and thus don’t have to pay any taxes.
When Person B sells the shares, he’ll consider the cost of acquisition and holding period from the time when shares were originally bought by Person A. Hence, the cost of acquisition will be ₹100 for person B and not ₹150.
Hope this helps!
Ok no matter of cost person B has to be the original cost of buying which person a bought and they have to pay 100-200rs profit zone right? stcg or ltcg
Hey,
Yes, the understanding is correct.
Any leads? If person A is allotted of shares from IPO & Can we transfer the shares before listing in market off market via demat and how tax is processed . First of all can we transfer shares like that i mean shares credited in Person A demat but can we transfer it
Hi @TeamQuicko ,
Can you please check if the example given on this link is correct
Because here although the LTCG Rs 300000 is calculated on the purchase price of the Sender, the tax paid at 10% is just 20000.
Hey @aagam_vora,
LTCG from listed shares is exempted up to ₹1lakh. Hence, the 10% tax in the above example was calculated after considering the ₹1L exemption.