Legality of gift geed from a person to a company

775 votes

yes.. you can transfer but as per income tax act its taxable for both the parties.. If the property is worth more than you paid for it, you could be liable to capital gains tax (CGT) when it is transferred to the limited company. This CGT position applies whether you gift the property or sell it to the company for full market value. There is a form of ‘holdover’ relief from CGT when a business incorporates. However, if the degree of involvement in the properties is not enough for the activities to amount to a ‘business’, it seems unlikely that this relief will be available.

Advocate Shabuddin B S LawRato

687 votes

Yes Company is a competant to make Gifts and to recieve Gifts, for that it is not necessary that the Donor should be a relative . And natural love and affection are not necessary requirment . Gift recieved by a Company is Capital Reciept and cannaot be charged to tax under Income Tax Act 1961, since there is no specific provision for taxability of such reciepts in the statute. Therefore company need not pay Tax.

Advocate S Mubarak Begum LawRato