Received A ₹7.5 Crore Property as Gift From Your Sister? Here's How Much Tax You Will Pay

Receiving a valuable gift like a property worth ₹7.5 crore from a sibling is a significant event, and many wonder about the tax implications involved. Under Indian income tax laws, gifts received from specified relatives, including sisters, are exempt from income tax. This article explores what this means for you when your sister gifts you a property and highlights other related costs you should be aware of. 

Income Tax on Gifts from Siblings 

According to Section 56(2)(vii) of the Income Tax Act, 1961, any property or sum of money received without consideration—meaning as a gift—is treated as “income from other sources” and is taxable if its value exceeds ₹50,000. However, an important exemption exists for gifts received from specified relatives, which include siblings, parents, spouse, and others. 

Since your sister falls under this specified relative category, the gift of property from her to you is fully exempt from income tax, regardless of its value. This means that even if the property is worth ₹7.5 crore, you will not have to pay any income tax when you receive it. 

Stamp Duty and Registration Charges 

While the gift is exempt from income tax, you will still need to pay stamp duty and registration charges to legally transfer the property’s ownership into your name. These charges vary depending on the state in which the property is located and can be a significant expense. Usually, the stamp duty rates for gift deeds are lower than for sale deeds but still need to be budgeted for. 

Capital Gains Tax on Future Sale 

It’s important to note that capital gains tax will apply when you sell the gifted property in the future. The cost of acquisition for you will be the same as that of your sister—the person who gifted you the property. This means that your capital gains will be calculated based on the difference between the sale price and the price your sister originally paid for the property. 

What If the Gift Is from a Non-Relative? 

If the property were gifted by someone other than a specified relative, and its value exceeds ₹50,000, the entire amount would be taxable as income in your hands. This makes gifts from siblings and other specified relatives highly beneficial from a tax perspective. 

Conclusion 

In summary, if your sister gifts you a property worth ₹7.5 crore, you will not owe any income tax on the gift itself. However, be prepared to pay stamp duty and registration fees for the transfer, and keep in mind capital gains tax obligations when you decide to sell the property later. Gifts from siblings are a tax-efficient way to transfer wealth, making it an important consideration in estate and family financial planning. 

Read more on: ITR Filing FY25: Are ESOPs Taxable? 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.