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Maturity proceeds in the hands of nominee incase of death

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fahad karu (Querist)
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18 February 2014 my client has recieved fd from his uncle, on the death of uncle... fd is made before 2 yrs.. the matiritu date is 26th feb 2014, now on maturity, wich portion is taxable. fd value 500000 term 2 yrs maturity value 599990 thnx in advance..

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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18 February 2014 If the uncle has paid tax on interest on accrued basis then that portion of the interest shall not be taxable again in the hands of the precipitant. Further the date of death is also not mentioned so the interest is to be calculated up to the date of death and interest after date of death is to be taxed in the hands of the nephew who received the FD after the death of his uncle in the assessment year 2014-15 but proper intimation must me made to the bank otherwise the bank will deduct tax under PAN of uncle and this will create a problem. So advise your client to replace his PAN after the death of uncle.

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