Tax-free occasions & one-off receipts — marriage, will, LIC, awards

References are to the Income-tax Act, 2025, old 1961-Act number in brackets.

1. Gifts on your marriage — fully exempt

Gifts received on the occasion of your marriage are 100% tax-free with no upper limit, and from anyone — relatives or friends (old Section 56(2)(x) proviso). This is the one time even gifts from non-relatives above ₹50,000 are exempt.

2. Inheritance & anything under a will — fully exempt

Money or property received by inheritance or under a will is fully tax-free, whatever the value (old Section 56(2)(x) proviso). Any income the inherited asset later earns is, of course, taxable in your hands.

3. Gifts from relatives — fully exempt, any amount

Gifts from specified relatives (spouse, parents, siblings, lineal ascendants/descendants and their spouses) are tax-free without limit. See the detail in gifts from relatives. Watch clubbing: income later earned on an asset gifted to your spouse or minor child is added back to you (Section 96, old 64).

4. Scholarships — exempt (old Section 10(16))

A scholarship granted to meet the cost of education is fully exempt — no cap, no condition on the source, as long as it's genuinely for education.

5. Government awards & approved rewards (old Section 10(17A))

Awards instituted or approved by the Government, and approved rewards for literary/scientific/artistic or public service, are exempt.

6. Life-insurance maturity & death proceeds (old Section 10(10D))

• Death benefit — always fully exempt.
• Maturity — exempt if the premium stayed within the limit (broadly 10% of sum assured for policies after 2012).
• Note the newer caps: maturity of policies with annual premium over ₹5 lakh (₹2.5 lakh for ULIPs) can be taxable — check your policy.

7. A partner's share of firm profit (old Section 10(2A))

Your share of profit from a partnership firm or LLP is tax-free in your hands — the firm has already paid tax on it. (Interest and remuneration you draw are separately taxable.)

8. Other one-offs worth knowing

• Gratuity, leave encashment, VRS, commuted pension — exempt within limits (Schedule III) — see salary exemptions.
• Amount from a recognised PF / NPS on retirement — exempt within conditions.
• Sum received from an HUF by a member, and on partition of an HUF — exempt.
• Agricultural income — exempt (only aggregated for the rate).

Who this helps

Everyone — the trick is to recognise the occasion and keep the proof (marriage evidence, will, scholarship letter, award notification, insurance documents) so the exemption isn't questioned.