Live Course on Drafting of Appeal and Reply of Penalty Notice by CA Sachin Sinha. Register Now!!

Clubbing of Income

Prem Chandra Gupta (Financial Specialist) (52 Points)

15 June 2011

I have deposited FD in bank in the name of my father and my wife and me also. I have added father due to more interest on senior citizen. It is matured after 02 years in Oct.2010 and I found that bank deducted TDS in 2007-08, 2008-09 & 2009-10 in the name of my father . My father has no Pan Card. So we are not able to know that bank deducted the TDS. We know at the time of maturity. The maturity amount transfered to my wife account.

Can I club the total Interst income & TDS from 2007-08 in my return. Or submit return in the name of my father who has no PAN CARD

Please suggest in detail.

Reply
Follow
Share

8 Replies

Shruthi (PCC Student) (111 Points)
Replied 17 June 2011

Can you pls tell what is the source of the F.D Investment?

If the source of such deposit is from your salary or business income, then you can club the whole maturity amount pertaining to your wife's under your return and can reduce the Tds deducted by bank from your tax liability after calculating the liability.

If the source of deposit is from your wife's income, no question of clubbing, it should come under your wife's return.

Prem Chandra Gupta (Financial Specialist) (52 Points)
Replied 17 June 2011

Dear Shruthi,

The source of Income for F. D. is mine.

My question is that the TDS deducted in the name of my father who has no PAN CARD and Interest income is also shown in father's name in the bank.

Can I club the total Interst income & TDS from 2007-08 in my return. Or submit return in the name of my father who has no PAN CARD.

U S Sharma (glidor@gmail.com) (21056 Points)
Replied 17 June 2011

as you have added father for interest gain, bank considered the father as 1st person of FD, paid high interest and deducted TDS from him. however bank must have informed you to submit 15G or 15H in advance prior to TDS event, which u ignored,

now you have nothing in hand, you have to file return of father and we are doubtful about the credit of TDS in absence of pan number.

Shruthi (PCC Student) (111 Points)
Replied 18 June 2011

Actually, if the bank has transferred the whole amount of FD maturity to you wife's account, then you can club such income and take that TDS as yours and can deduct from your tax liability provided you get the tds certificate from the bank.

If your bank has not shifted the maturity amount from your father's account to your wife's, then you cant club that income, you must file a separate return for your father and before filing return try to get PAN card for your father.

PAN obtaining process is been easy only nowadays. so if you obtain befor filing return you can claim tds deduction. If you fail to obtain, then TDS cant be claimed.

CA Suraj Prasad Shaw (Chartered Accountant) (504 Points)
Replied 18 June 2011

Originally posted by : U S Sharma
	as you have added father for interest gain, bank considered the father as 1st person of FD, paid high interest and deducted TDS from him. however bank must have informed you to submit 15G or 15H in advance prior to TDS event, which u ignored, now you have nothing in hand, you have to file return of father and we are doubtful about the credit of TDS in absence of pan number.

Agreed with U S Sharma.

Prem Chandra Gupta (Financial Specialist) (52 Points)
Replied 18 June 2011

Amount of FD and whole Interest amount transffered to my wife account . She has PAN Card.

Shruthi (PCC Student) (111 Points)
Replied 18 June 2011

Then you can very well club the interest income in your return and can claim TDS against your whole tax liability. Now no need to worry about your father's PAN.

Sumiti Jain (FP) (1364 Points)
Replied 18 June 2011

Originally posted by : U S Sharma
	as you have added father for interest gain, bank considered the father as 1st person of FD, paid high interest and deducted TDS from him. however bank must have informed you to submit 15G or 15H in advance prior to TDS event, which u ignored, now you have nothing in hand, you have to file return of father and we are doubtful about the credit of TDS in absence of pan number.