Property Gifts Above ₹45 Lakh Under Scanner: New Income-Tax Rules Tighten Checks, Raise Penalty Risks
Property Gifts Above ₹45 Lakh Under Scanner: New Income-Tax Rules Tighten Checks, Raise Penalty Risks
Registrars to report high-value gifts; non-disclosure or fake arrangements may invite heavy penalties and scrutiny
In a significant shift aimed at tightening tax compliance, property gifts valued at ₹45 lakh and above will now come under closer scrutiny under the Income-tax Rules, 2026. The move brings such transactions into a formal reporting framework, increasing transparency and reducing the scope for misuse.
Under the new rules, property registrars will report high-value immovable property gifts through the Statement of Financial Transactions (SFT), creating a digital trail that allows the Income-tax Department to monitor such deals more closely.
While gifting property among family members remains a common and legally accepted practice in India, authorities have made it clear that such transactions must now stand up to stricter verification.
Gifts received from specified relatives or on occasions like marriage will continue to enjoy tax exemption under existing provisions. However, if a property is gifted by a non-relative and its stamp duty value exceeds ₹50,000, it becomes taxable under “Income from other sources.”
The key change lies in traceability. Earlier, such gift transactions were often outside the reporting net. With Rule 237 now in place, gifts above ₹45 lakh will be visible to tax authorities, enabling deeper scrutiny into funding sources and ownership structures.
Officials may examine who actually financed the property, whether the donor had the financial capacity to own it, and whether the transaction is genuine or merely structured to conceal real ownership.
If irregularities are found, the consequences can be severe. Undisclosed or misreported gifts may be treated as unexplained income, attracting penalties of up to 200 per cent of the tax payable, along with interest and possible prosecution.
There is also a risk of action under the Prohibition of Benami Property Transactions Act, 1988, especially in cases where ownership structures are found to be non-genuine.
Experts note that the broader message is clear: documentation, transparency and genuine intent are now critical. Even beyond the ₹45 lakh threshold, increased reporting and mandatory PAN requirements for transactions above ₹20 lakh mean more property deals could fall under scrutiny.
The updated framework signals a move towards data-driven enforcement, where property transactions — including gifts — are no longer invisible but increasingly traceable and verifiable.
