Gifting my brother an SUV; Will he be liable for taxes

I am a non-resident Indian planning to gift an SUV to my brother who is in Delhi, working in a MNC.

BHPian eternalck recently shared this with other enthusiasts.

Hi, I have a specific question which I could not find the exact location where to ask, so asking here.

I am a non-resident Indian planning to gift an SUV to my brother who is in Delhi, working in a MNC. No special occasion.

Will it attract tax liability for him? Anybody with any experience of a similar situation? Any recommendations appreciated.


Here's what BHPian Cyborg had to say on the matter:

Ask your brother to speak to a Chartered Accountant, there is a specific verbiage which needs to be used in the letter which you need to post/courier to him. It goes something like this “Out of natural love and affection to you as your brother, I am gifting you (free text)”. Also mention your bank name, address and account number in the letter.

Please check the exact wordings, your gift to him as a blood relative is tax free for him, whether it is cash to his bank account via transfer from your NRI account or in your case a car.


Here's what GTO had to say on the matter:

Here's what my CA says:

  • For blood relation = real brother = gifts are exempt.
  • No income tax if gift is received from brother.

Here's what BHPian r-a-s had to say on the matter:

Gifts received from relatives are exempt from tax. According to the IT Act, following persons would be considered as relative: spouse, brother or sister, brother or sister of the spouse, brother or sister of either of the parents, any lineal ascendant or descendent, any lineal ascendant or descendent of the spouse, spouse of the persons referred above.

Here's what matizcrazy had to say on the matter:

While I am no expert on tax laws, I remember being told by the salesperson that the NEFT / cheque has to be from the bank account of the person in whose name the car will be registered. In fact, they insisted the same for even road tax, registration payment; also they wanted PAN and Aadhaar of the potential buyer and owner.

High likelihood of attracting an IT notice, especially if the money is paid from a foreign source or NRE account.

Simpler to transfer the money to the brother (no tax restrictions) and let him buy it.

Check out BHPian comments for more insights and information.

Seat belts save lives