𝗠𝗬𝗧𝗛 𝗩𝗦 𝗙𝗔𝗖𝗧: 𝗔𝗥𝗘 𝗙𝗘𝗦𝗧𝗜𝗩𝗔𝗟 𝗚𝗜𝗙𝗧𝗦 𝗙𝗥𝗢𝗠 𝗘𝗠𝗣𝗟𝗢𝗬𝗘𝗥𝗦 𝗧𝗔𝗫-𝗙𝗥𝗘𝗘?

Diwali gifts, festive vouchers and reward coupons are common workplace benefits. But the tax treatment of these gifts deserves attention.

𝘔𝘠𝘛𝘏: All festival gifts received from employers are tax-free.

𝘍𝘈𝘊𝘛: Under the Income-tax Act, 2025, read with Rule 15 of the Income-tax Rules, 2026, employer gifts, vouchers and tokens enjoy an exemption only when their aggregate value is below ₹15,000 during a tax year.

Here is how the provision works.

1. Gifts worth ₹10,000 during the tax year. No taxable perquisite arises.

2. Gifts worth ₹14,500 during the tax year. The aggregate value remains exempt.

3. Gifts worth ₹18,000 during the tax year. The entire ₹18,000 becomes taxable as a salary perquisite, not merely the amount exceeding ₹15,000.

A few points worth remembering:

• The ₹15,000 threshold applies to the aggregate value of gifts, vouchers and tokens during the tax year.

• Gifts received by a member of the employee's household also fall within the provision.

• The exemption applies only when the aggregate value is below ₹15,000. At exactly ₹15,000, the full amount becomes taxable.

• Taxable value forms part of salary income and attracts tax at the applicable rates.

𝗪𝗛𝗔𝗧 𝗦𝗛𝗢𝗨𝗟𝗗 𝗘𝗠𝗣𝗟𝗢𝗬𝗘𝗥𝗦 𝗗𝗢?

Maintain an employee-wise record of festival gifts, vouchers and other tokens issued during the tax year. Consider the aggregate value while computing salary perquisites and TDS.

A small festive benefit also needs correct tax reporting.

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