Stridhan: Income Tax Laws For Wedding Gifts That Every Indian Woman Must Know

Stridhan or Stridhana as we know and the law recognises is the total wealth received by a woman from her in-laws, parents and husband during the time of the wedding. Since it includes money, jewellery and other such valuable items, many people have questions about the income tax law.

It is more important for women to know what the law says about tax being imposed on that property because she owns it all. It is her absolute property regarding which if she is not aware, people can take advantage of the situation.

Therefore, we connected with CA Shreya Jaiswal, Finance Content Creator, to understand the imposition of tax on stridhan. Here is what she said.

Origin Of Stridhan

CA Jaiswal shared that the concept of a woman’s property first originated in Hindu law. Later, it got accepted by all castes and religions. It includes assets owned by the woman or whatever she has received from her maternal home, in-laws, husband and relatives around the nuptial fire or later in life.

For example, if a woman receives gifts after a year of marriage, having a baby or just for no reason, all will be accounted as her absolute property.

Income Tax On Stridhan

CA Jaiswal said that stridhan is treated the same under the Income Tax Law as any other taxable gift received from any source. However, one must forget that there are a few exemptions under the law.

Women must be aware that jewellery, money or assets received by them during a wedding is exempted from income tax. It means your gifts are absolutely free, and you will not have to pay any tax on them.

Don't Miss: Stridhana: History Of The Only Property Women Owned In Ancient India

The list also includes gifts or property received as a part of the inheritance, death contemplation, etc. All of this is also excluded from income tax. All you have to be wary of is the definition of relative under the law. A relative under the income tax law is defined as a husband, wife, sister, brother or someone from the lineal ascendant or descendant of the person.

CA Jaiswal said, “Barring the above all other general receipts, forming a part of stridhana are taxable and the woman must ensure to set aside a sum equal to the income tax liability on these receipts.”

Safeguarding Women

However, the financial expert warned against safeguarding women. To protect the assets, a married couple must proceed ahead with a gift deed of all the valuable belongings.

Don't Miss: Jar System For Saving Money

You must have a record of all the gifts presented at the wedding, including the cash that we refer to as ‘shagun’. It is one of the most common gifts given to any pair during the wedding festivities. CA Jaiswal suggested depositing the cash in the bank to prevent any income tax inquiries in the future.