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Clubbing of Income

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This query is : Resolved

Shailesh (Querist)
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08 February 2021 I had transferred 10 Lakh to my wife. She invested part of it in Shares and MF and she is doing business of share trading with the remaining amount.
My question are about clubbing of income:
1. I assume income (capital gain) if any received from share/MF investment will be clubbed with my income. am I right ?
2. What about her trading income. Will it be treated as her income or this also clubbed with my income?

Thanks in advance,
SD

CA.Pujah

CA.Pujah (Expert)
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09 February 2021 In case of direct or indirect transfer of assets to your spouse by you for inadequate consideration, income from out of such asset is clubbed in your hands .
However, income from reinvestment of clubbed income by a spouse is not clubbed in the hands of individual. So, the income derived from the Rs. 10 lakh transferred by you to your spouse will be clubbed in your hands.

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