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Creation of huf

21 February 2017

Dear Sir/Madam, Can HUF be created by receiving gift from brother or sister of individual's either of parents? or HUF can be created only by gift receiving from member of huf or lineal relative of individual?

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Studentsca (CA Practice ) (3577 Points)
Replied 21 February 2017

Huf is created by preparing huf deed.

Thereafter you are required to apply for pan card on the basis of the huf deed. Separate pan card is required as income tax act identifies it as a separate entity.

After you receive the pan card you can open a bank account in the name if huf.

What you are saying is creating the corpus for the huf. Huf corpus can be created by receiving gifts. Gifts received from members is tax free however aggregate gifts received from non members is tax free only upto Rs. 50,000/-.