I want to gift my 55-year-old mother Rs20,000 per month. Where should I put this money?
—Suraj Jajodia
There are prima facie two issues that need to be addressed here. First, whether we can gift to family members (including mother) and second, how should you invest the said amount on behalf of your mother, subject to her utilisation.
The Income-tax Act under Sec. 56(2) defines who is a relative and who are the specified relatives to whom, if we give gift for amount exceeding Rs50,000 (without consideration), it still does not become a taxable income in the hands of donee (receiver). The list is exhaustive and includes the following: spouse of individual, brother and sister of individual as well as spouse of individual, brother and sister of either of the parents of individual, any lineal ascendants or descendant of the individual or of the spouse of the individual.
