Parents’ gifts to married daughter are tax-free but income from them is taxed

Gifts from parents to a married daughter are generally tax-free under the Income-tax Act, 2025, regardless of amount, as parents fall under 'specified relatives'. The usual Rs 50,000 threshold for gifts does not apply, according to tax expert Nishant Shanker of Navraj Global Advisors, as reported by Livemint.

However, any income generated from the gifted asset, such as interest, rent, dividends or capital gains, is taxable in the daughter's hands. For example, if gifted money is placed in a fixed deposit or ULIP, the interest is taxable. Rent from gifted property or capital gains from its sale are also taxable.

Similarly, for NRIs gifting money to their father's Hindu Undivided Family (HUF), the gift itself is tax-free if the NRI is a member of that HUF. But income earned by the HUF from investing those funds will be clubbed with the NRI's taxable income, Livemint reports.