Best ways to convert money received in your wedding?

Well, the best way to convert all the illegal money to legal money is through Indian Weddings. Many of the businessmen and politicians do this.

Under section 56 of the income-tax Act, money exceeding Rs.50,000 received by an individual during a financial year without or for inadequate consideration, is taxed under ‘Income from other sources’ in the hands of the recipient.

An exemption is allowed under section 56 if the sum of money is received from a relative or on the occasion of marriage. So, the amount of gift that you have received on your wedding day shall not be taxable as income in your or your wife’s hands. This can be claimed as exempt from tax. It, however, needs to be disclosed in your returns to be compliant from a reporting perspective.

So all the 500 and 1000 rupee notes can be given to your friend/relative/cousin/mutual friend in his/her wedding so that they can deposit in the bank and remit it back to your bank account.

How does this work?

1. The newly wed person discloses it as gift on the occasion of marriage. So it’s okay.

2. The person with the illegal money gets back his/her money through a bank transfer. Which couldn’t have been done without falling prey to IT dept.

Alternatively, one can earn commission of 10% or more by converting such illegal money into legal money.

http://www.cainindia.org/news/11_2016/best_ways_to_convert_money_received_in_your_wedding.html?tstst=5827c72f9c240&ntitle=Best%20ways%20to%20convert%20money%20received%20in%20your%20wedding?