How can you Gift Stocks to Someone - StockDaddy
We are all stuck at once in our life when it comes to selecting gifts for someone. Every year we purchase gifts on birthdays, weddings, anniversaries, and other special occasions.
But it becomes difficult to purchase a budget-friendly and attractive gift. If we plan to give the car, diamond rings, or gold as a gift, it can surprise a person. But we are looking for budget-friendly gifts that will add some value with the time then the stocks are the best option.
Suppose you are a mother or father. Every year you give a birthday gift to your child that can be anything.
But if you add on those gifts with stocks of any affordable amount then, after 18 years of compounding, you will notice the value that those gifts added to the wealth of your child that may help your child buy his dream car or invest in abroad studies and much more.
That’s how stock gifting proves its worth with the time.
Let’s dive into the concept to know the complete insights of the gifting process.
Stock gifting is a revolutionary change in terms of giving gifts. Zerodha is the very first brokerage platform that offers this opportunity where you can gift stocks and ETFs to your loved ones.
Introducing the concept of long-term investing by gifting stocks, ETFs, mutual funds, and gold bonds where anyone who has their Demat accounts can receive or send gifts.
You can even gift stocks to the kids and make them aware of investments and money management processes.
It is important for you to know gifted stocks with the capital gain will be moved with the gain to the Demat account of the receiver.
This implies that the receiver will have to pay taxes (such as the difference between the buy price and the selling price) on the capital gains if he/she sells out the stocks in the future.
What are the requirements?
There are some basic requirements you need to complete before gifting any shares of stocks to someone.
There are a number of brokers in India who offer different processes for giving stocks as a gift. Here you can understand how to gift stocks using the Zerodha platform.
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While gifting the stocks the standard off-market transfer fee is chargeable which is ₹25 + 18% GST or it can be 0.03% per stock. This is an automated process and debited from the sender’s trading account.
The price of stocks gifted defined the tax implications. The receiver may get the tax implications if the price of the gift is more than ₹50,000.
Kindly keep in mind that gifting stocks from your Demat account and selling them at the same time may put you in trouble and that may result in an exchange auction penalty.
In the following instances, taxes on the gifting of shares are not considered:
Apart from the digital process, you can also give stocks as a gift by offline method. You are easily able to transfer the stocks off-market that are held with NSDL or CDSL.
There are a lot of benefits of stocks as a gift. The receiver of the gift can have the advantage if the stock's prices fluctuate positively in the stock market.
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