Apple has made some changes in the procedure for gifting apps. If you have an iPhone or iPad and you have NOT updated to iOS6, then the old post will still be appropriate for you. You can find it here.
How to Buy an App as a Gift:
(I’ll use “app” for the description, but this also works for songs, albums, videos, books, all things iTunes)
In iOS6 you can no longer gift an app directly from your iPhone or iPad. You must do it through iTunes, on your computer. *** It changed again! Now you CAN gift directly from your iPhone or iPad, and you can learn how in this blog post.
Open iTunes, and go to the app that you would like to send as a gift.
Tap on the arrow that is next to the price.
A drop down menu appears. Select “Gift this app”
A new window will open, like the one I pasted below. Simply fill in the fields, and add your happy message to your recipient, and you’ve done the deed! You can send to one or multiple recipients, and you will be billed accordingly.