Raksha Bandhan: Can a brother gift property to his sister? Know the tax rules
A brother can gift property to his sister without immediate income tax liability, as siblings are considered 'relatives' under Section 56(2)(x) of the Income Tax Act, 1961. However, when the sister sells the property, capital gains are calculated based on the brother's original purchase price. Starting July 2024, indexation benefits will be withdrawn for such gifts, imposing a flat 12.5% tax on long-term capital gains.