Income Tax liability for the savings done in the name of wife and myself.

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  1. mukeship

    mukeship New Member

    Income Tax liability for the savings done in the name of wife and myself.

    1) My wife has a PAN.

    2) In FY 15-16 I have deposited 1.5 Lakhs in her PPF ACCOUNT.

    3) In FY 15-16 I have deposited 3.0 Lakhs in 10 YEAR N.S.C. VIIIth issue with her name as first and with my name as joint holder.

    4) Total amount invested i.e. 1.5+3.0 Lakhs is from my advance taxpaid salary i.e. my employer has already deducted tax (TDS) while paying me the salary.

    A) KINDLY LET ME KNOW WHETHER THE AMOUNT SAVED IN PPF & NSC WILL BE CONSIDERED AS MY WIFE'S INCOME THIS F.Y.?

    B) IF YES, KINDLY LET ME KNOW SHALL MY WIFE WILL HAVE TO PAY ADVANCE TAX ON HER THIS INCOME.

    C) HOW MUCH SHALL BE THE TOTAL TAX ON THIS INCOME?


    Thanks
    Mukeship
     
  2. V K Khanna

    V K Khanna Active Member

    If you transfer any amount in your wife's name, the Income arising out of such transfer in the hands of your wife will be clubbed with your income and taxed in your hands.
     
  3. mukeship

    mukeship New Member

    Shri V K Khannaji,
    Thanks a lot for your kind reply.
    Please clarify:
    1) I HAVE ALREADY PAID INCOME TAX ON THE INVESTED AMOUNT (TDS: BY MY EMPLOYER). Pl, LET ME KNOW WHEN THIS INCOME IS GIVEN TO WIFE, WILL IT BE TREATED HER INCOME AND SHE WILL HAVE TO PAY I/TAX ON IT IN THIS FINANCIAL YEAR????
     
  4. V K Khanna

    V K Khanna Active Member

    There are two issues in your query on which tax implications are involved:-

    1) Amount transferred to your wife and invested in her name, and

    2). Income arising out of the transferred amount, in the hands of your wife.

    If you transfer any amount to your wife as a gift, it will be treated as an exempt from gift tax.

    However, income arising out from such gift will be clubbed with the Income of the doner and taxed accordingly.
     
  5. mukeship

    mukeship New Member

    SHRIV K KKHANNAJI,

    THANKS A LOT AGAIN FOR YOUR KIND AND QUICKEST POSSIBLE REPLY.

    I SHALL BE HIGHLY OBLIGED, IF YOU MAY KINDLY QUOTE THE RELEVANT I.T. RULES/CITATIONS/ORDERS FOR MY REFERENCE.

    Please also let me know whether my wife will have to furnish a self declaration regarding gifted amount while she files her return online for this financial year??

    Regards

    Mukesh Agrawal
     
  6. V K Khanna

    V K Khanna Active Member

    Clubbing of Income ---- Sec 64(1)(iv): Income which will accrue on the amount gifted will be includible in the Income of the doner for determining tax.

    Gift to wife --- Second proviso to Sec 56(2)(vii) : Any sum of money or any property recd from any 'relative' as gift is not liable to tax. Spouse of the doner of the gift is included in the definition of the 'relatve' in the Act.

    In case your wife is filing the return of income, she may show the gift amount in the col. relating to exempt income in the return. If her income is below the threshold limit of taxable income, there is no need to file the return or a self declaration about the gifted amount received.
     
  7. mukeship

    mukeship New Member

    SHRIV K K KHANNAJI,

    SIR LOTS OF THANKS FOR YOUR KIND AND QUICK REPLIES.

    THESE ARE VERY HELPFUL TO ME.

    REGARDS

    MUKESH AGRAWAL
     
    V K Khanna likes this.
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