Diwali Gift Taxable or Not: Most companies give bonuses and gifts to their employees on Diwali. But do you know whether they are taxed or tax-free. You can make your Diwali even more special by understanding the tax rules.
Diwali Bonus 2025: As soon as Diwali comes, there is no limit to the happiness of the job seekers. Bonus, cash, gift vouchers, electronics items or sweets received from office bring a smile on everyone’s face. But do you know that some of these things come under the purview of income tax and some do not? If you know which bonus or gift is taxable and which is not, you can improve your tax planning and avoid problems with the Income Tax Department.
diwali gift tax free
By knowing the rules regarding Diwali gifts, you can make a correct estimate of your bonus and gifts. With this, there will be no mistake in ITR filing and most importantly, you can enjoy the joy of Diwali without paying any tax.
Are Diwali gifts tax-free?
Not all Diwali gifts are tax-free. Small gifts like boxes of sweets, clothes or electronic gadgets up to Rs 5,000 are usually tax-free. But gifts above Rs 5,000, such as expensive electronics, jewelery or high value vouchers, are fully taxable. The total value of these gifts is added to your annual income and taxed like normal salary income.
Is Diwali cash bonus taxable or not?
Cash bonuses are not tax-free in any case. For example, if you received Rs 30,000 as Diwali bonus, it will be added to your annual income and taxed as per your income tax slab. There is no separate exemption on cash bonus, hence it is important to report it correctly in ITR. Incorrect reporting or trying to avail exemption can put you at risk of income tax notice.
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