Can I show Rent on name of HUF to save Tax?

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  1. Ms. Doubtful

    Ms. Doubtful New Member

    Suppose an individual have a property in his/her personal name. His/her Salary income is already taxable under the highest tax slab rate and also earns a rental income from the above mentioned property. To save tax to some extent they decide to form a HUF. Now, for the rental income to be considered in the hands of HUF, my doubt is:
    Whether transfer of property is to be given effect by registering the same in the name of HUF or just by book entries showing the asset gifted to HUF ?

    Please reply...
     
  2. Parul_Gupta

    Parul_Gupta Active Member

    If you merely do book entries - it is a clear case of tax evasion and will easily come in the knowledge of the income tax authorities.

    The property should be registered in the name of the HUF for it to earn rent on it.
     
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