Capital gainbonds proceeds on maturity can be invested in FD in my wife's name?

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  1. If I invest my Capital Gain in Capital Gain Bonds for 3 years and on Maturity If I want to invest that proceeds in my Wife's name in Bank FD, what is the position on income tax angle for me and my wife?
     
  2. Sumit Agarwal

    Sumit Agarwal Active Member

    After 3 years on maturity of capital gain bonds as such no taxation occurred for any assesse. But in your case as you are investing the matured amount in yours wife name, interest generated from the FD would be clubbed in your income and you are liable to pay tax on that and not your wife.
     
  3. Manoj Mehra

    Manoj Mehra Active Member

    You can gift the maturity proceeds to your wife and then the clubbing provisions wont apply.

    No tax in your hands in such a case.
     
  4. sai tejesh(ca.final)

    sai tejesh(ca.final) Active Member

    Yes.. I agree with manoj that,if you transfer such maturity proceeds to your wife.It is exempted.,BUT..
    If you invest such amount in your wife's A/C as FD,then interest received from such FD is clubbed in your own hands, and you have to pay income tax for that interest income.

    That meanse if your wife uses such maturity proceeds for her household expenses--IT IS EXEMPTED.
    But if your wife (or) yourself invested such maturity proceeds at any where else and earns income--then such income is clubbed in your own hands.
     
    Last edited: May 26, 2015
    Manoj Mehra likes this.
  5. Prof Bajaj

    Prof Bajaj New Member

    If you gift maturity proceeds to your wife, then the FD interest will be clubbed with your income.
     
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