To Envelope Or Not To Envelope

In the tussle between a casserole or an envelope filled with cash, you can safely bet on to-be-wed couples landing on the latter as their preferred wedding gift. Yes, even if this tussle featured the Le Creuset Cherry Red Oval Iron Casserole.

Monetary gifting options, like cash or gift cards, are becoming increasingly popular as more and more couples plan to start their lives separate from their parents after the wedding. Starting this new chapter in their lives with some extra cash, or even being able to fund a luxurious honeymoon, can be nice. It can also be a way to offset the wedding planning costs for the couple.

In India, the practice of giving shagun, or sagan, is common at weddings, with ornately designed envelopes filled with cash often rivalling the extravagantness of the wedding outfit! In the USA, couples are adding cash registries, in lieu of traditional gifting ones, for their weddings.

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If you’re planning to get married soon, or are stumped about what to gift at a wedding you’re supposed to attend, take a look at our comprehensive guide on everything to know before gifting money at a wedding…

Everything To Know About Gifting Money At A Wedding

Is it common to gift money at a wedding?

Yes, gifting money at a wedding is not rude or thoughtless, especially if you are not immediately related to the couple. Like the practice of gifting shagun in Northern India to brides and grooms, it is a very common thing around the world. “If you don’t know the couple well, it’s a good idea to give cash at a wedding so that the young couple can use it to buy something they need,” says etiquette expert Shital Kakkar Mehra.

In Chinese weddings, the bride traditionally has to participate in a tea ceremony known as cha tao. Near the end of the wedding day, the bride serves tea to her new in-laws. When the tea is finished, the bride goes around collecting the empty cups from each family member. In return, they present her with a red envelope, known as ang bao, which is usually filled with money.

It’s common for the groom’s parents in Japan to give the bride’s family money in a special envelope, known as shugi-bukoro.

A fun tradition that’s common in Poland, Spain and Puerto Rico is when guests gift money, often by pinning it to the bride’s dress, to get a chance to dance with her! In Nigeria and Italy, a special bag is dedicated to collecting cash and check-filled envelopes from the guests for the couple.

Fans of K-dramas would know how common, and often vexing, the practice of gifting money at South Korean weddings can get. Commonly known as Chug-ui-geum, the congratulatory money is usually presented at the entrance to the wedding venue. In return, the guests are given a meal ticket that allows them entrance to the wedding banquet. The amount is discreetly noted down in a register.  Guests who cannot attend are given options to transfer money to the newlyweds’ bank account number which is usually indicated in the wedding invite.

How to decide the appropriate amount to gift at a wedding?

A common rule of thumb followed in most Indian households is to match, or surpass, the amount gifted to you at your wedding, or a close relative’s wedding. However, the amount to be gifted can depend on a number of factors, the most important one being your closeness to the person, or couple, getting married.

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In many Asian countries, it’s a common practice to look up the venue where the couple is getting married and see how much a plate of food there costs. In fact, many websites in Singapore helpfully lay out the cost of tables or meals at most major hotels and popular wedding venues in the country.

Why do most shagun envelopes come with an extra one-rupee coin?

In Hindu weddings, the shagun envelope usually carries an extra one-rupee coin. Zero is said to denote the end or completion of a cycle, which is why it’s considered auspicious to add a one-rupee to change the denomination. Some people also believe that the numbers 100, 5000, 1000 or 2000 are divisible by multiple numbers. Odd numbers like 101, 501, 1001 or 2001 are indivisible and thus represent permanence.

Can you be taxed for the cash amount you receive at a wedding?

Gifts received by a newlywed couple as wedding presents are tax-exempt. Regardless of the value of the gift, if they are given by an immediate family member, such as their parents, siblings, any of their siblings' spouses, or the siblings of their parents, they are exempt. In the case of receiving gifts, in cash or kind, from non-relatives, it could be taxable if it exceeds INR 50,000.

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It should also be noted that in case a person receives INR 2 lakhs or more as cash present, or kind, at a wedding, the provisions of Section 269ST of the Income Tax Act are applied, which can attract consequences under Section 271DA. For instance, if your parents send INR 10 lakh to your bank account as a wedding gift, you will not be charged any tax as they are your lineal descendants, but you might have to pay a penalty.

Section 269ST states that no person shall receive an amount of INR 2 Lakhs or more by way of cash under the following conditions:

If these conditions are not met, it could make you eligible for a penalty under Section 271DA of the Act. It states that a person shall be held accountable to pay a penalty equal to the amount of such receipt, ie the penalty amount will be 100% of the amount acquired in violation of this section.

Whether you receive INR 5,000 or 50,000, maintaining proper documentation is important to ensure you can prove that you received the money as a wedding gift. A gift deed or a letter from the donor, to prove the gift was received on the occasion of marriage or empty envelopes with the amount of money noted can be shown as proof, if necessary.

Is there a right way of gifting cash at a wedding?

Since we’ve established that gifting cash to the bride and groom at a wedding is fairly common and welcomed, the question is how to deliver it at a wedding.

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Some cultures might have their traditional way of doing this. Like in South Korea, it is preferred to give cash in special white envelopes with the guest’s name written vertically on it. The notes have to be crisp new bills stacked front first.

“Give the money in a nice dressy envelope and put your name inside the envelope on a small card. Remember to seal the envelope properly,” advises Shital. Since Indian weddings do not have the culture of collecting money at the entrance, she says, “Who is the person who has invited you to the wedding? If it’s the parents, hand over the envelope to them. If it’s the couple, give it to the one you know well. They will in turn have a trustworthy relative who will keen the cash for them.”

The important thing to remember, when it comes to wedding gifts, is to be considerate of the couple. Whether you give cash or a fancy toaster, it should be something that you think would be of use to the newlyweds, or at least remind them of you in a pleasant way!