Treat your taxes well this Diwali 2019
It was a dark night of Amavasya; when the kingdom of Ayodhya welcomed Lord Ram, the banished king, who returned home after being in exile for 14 long years. This return was post Lord Ram’s victory over Ravan ( the king of Lanka who abducted Sita).
To rejoice the home coming of their beloved king; Ram, the people of Ayodhya lit up his entire pathway with earthen lamps(diyas). And from there began the tradition of celebrating Diwali as a festival which resembles the victory of good over evil, light over darkness and happiness over despair.
Indians are widely acknowledged for the strong family bonds which they cherish and to a great extend the festivals which we celebrate in our country are the reason behind this. Diwali brings along with it a season of merriment, wherein we enjoy the company of all our loved ones, dwell on some mouth-watering delicacies and revive our old traditions which were taught to us by our ancestors.
Diwali festivities stretch for a period of five days, each day having its own significance. The five days of celebrations begin with
- Dhanteras, the first day;
It is considered as an auspicious day for the merchants. It is also believed that Dhanteras is the most propitious day for buying precious or semi precious metals like Gold, Silver or Steel.
- The second day is marked by Narak Chaturdashi,
This day is celebrated to commemorate the victory of Krishna over the demon, Narakasura.
- The third day is the day of Lakshmi Pujan,
On this day Goddess Lakshmi is worshipped who is considered as the Goddess of wealth and prosperity. Flowers, rangolis and small diyas are all adorned at the doorways to welcome her into the house.
- The fourth day is Govardhan Puja
It is celebrated to commemorate when Lord Krishna asked the masses to worship the nature and for this reason people started worshiping cows then on.
- The last and final day of Diwali; Bhai Dooj
It symbolises the love between brothers and sisters. Women pray for the well being of their brothers and brothers in turn vow to protect their sisters.
Diwali this year i.e 2019 is round the corner and it’s time for you to exchange gifts with your family,
friends, employees etc. So, we at Tax2win are here to provide you with some valuable information regarding the taxability of your Diwali gifts.
Taxability of Diwali Gifts
There can be 3 scenarios in case of gifts :
- Diwali bonus or gift received from the employer : If you have received any gift from the employer on the occasion of Diwali or on any other occasion, then it is taxable in the hands of the employee. It is exempted only if the amount or the value of the gift is less than Rs. 5,000/-. Gifts can be in cash or in any other form.
- Gift received from relatives : Any gift received from relatives (relatives like father, mother, spouse, brother, sister etc) are completely tax free and gifts received from non relatives are tax free only if the worth of the gift is less than 50,000. If the total value of the gifts exceed the figure of Rs. 50,000 in the given financial year then tax is applicable for the whole amount.
- Business gifts: If the gift that you have received is part of your business relations, then it is taxable in the hands of the receiver. The value of such a gift needs to be added to the taxable income and accordingly the tax needs to be paid.
As the fireworks and diyas illuminate all corners of the globe this diwali. We at Tax2win pray that the light brightens up not just your home but your lives as well.
Shubh Deepawali !