Mutual Fund For Minor
This query is : Resolved
03 November 2021
I want to Invest in Mutual Fund for my Minor Son, please suggest if I can Invest under the following conditions.
1. Payment would be Given from my minor son's Bank Account
2. I ( His Father ) will be the first Holder and my Son will be the Nominee
As my son is a minor his books of accounts will be merged with my books therefore in whose books will I show the Mutual Fund Entry, my minor son or mine.
Secondly since the payment is made from my sons books and I his father being the first holder ( as a Guardian ), entry cannot be shown in my books as payment is not been made from my bank.
Secondly I cannot show in my sons books even though payment is made from his bank as the First holder is myself ( his Father ) and my PAN number would be given
Supposing
If I show the purchase entry in my minor sons books when Redemption will happen Long Term will reflect in my account as my PAN number is given, and I cannot calculate LTCG as there are no purchase shown in my books but purchase entry is shown in my minor sons books. So there cannot be Two LTCG, my sons as purchase entry is shown in his books and my books as PAN number for purchasing MF is linked with my name.
Secondly
If I show the purchase entry in my books, but payment is made from my minor sons bank account, and when redemption will happen then all the proceeds would go into my minor sons account as his details are given. Then problem is that if there are no purchase of MF then how the redemption proceeds he has received in his bank.
If I give my bank details for redemption , but payment is made from my minor sons bank, then how will I show for what this payment is made.
My question is how do I make the MF Purchase If
1. Payment is made from my sons Bank Account
2. I ( his Father ) is the First Holder as Guardian
3. My son is a Nominee
4. In whose books I show the Entry.
I hope I am clear with my query.
1. Payment would be Given from my minor son's Bank Account
2. I ( His Father ) will be the first Holder and my Son will be the Nominee
As my son is a minor his books of accounts will be merged with my books therefore in whose books will I show the Mutual Fund Entry, my minor son or mine.
Secondly since the payment is made from my sons books and I his father being the first holder ( as a Guardian ), entry cannot be shown in my books as payment is not been made from my bank.
Secondly I cannot show in my sons books even though payment is made from his bank as the First holder is myself ( his Father ) and my PAN number would be given
Supposing
If I show the purchase entry in my minor sons books when Redemption will happen Long Term will reflect in my account as my PAN number is given, and I cannot calculate LTCG as there are no purchase shown in my books but purchase entry is shown in my minor sons books. So there cannot be Two LTCG, my sons as purchase entry is shown in his books and my books as PAN number for purchasing MF is linked with my name.
Secondly
If I show the purchase entry in my books, but payment is made from my minor sons bank account, and when redemption will happen then all the proceeds would go into my minor sons account as his details are given. Then problem is that if there are no purchase of MF then how the redemption proceeds he has received in his bank.
If I give my bank details for redemption , but payment is made from my minor sons bank, then how will I show for what this payment is made.
My question is how do I make the MF Purchase If
1. Payment is made from my sons Bank Account
2. I ( his Father ) is the First Holder as Guardian
3. My son is a Nominee
4. In whose books I show the Entry.
I hope I am clear with my query.
03 November 2021
1. Firstly, the bank accounts are opened with first name as minor (your son), while joint holder as the guardian.
2. Till he attains majority, the investment will reflect in your personal BS.
3. Till he attains majority, all the income/gain/dividend etc. will be clubbed in your IT file.
2. Till he attains majority, the investment will reflect in your personal BS.
3. Till he attains majority, all the income/gain/dividend etc. will be clubbed in your IT file.
03 November 2021
OK Understood
But my further query is, If I show in my BS, how will I show the Purchase entry in my books as the funds was paid from my sons bank account.
1. Should I show as Loan received from my minor son
2. After my sons becomes a major how do I transfer the MF from my account to his BS.
I cannot show as Gift given as my son is actual Purchaser, I am only the holder as the Guardian.
But my further query is, If I show in my BS, how will I show the Purchase entry in my books as the funds was paid from my sons bank account.
1. Should I show as Loan received from my minor son
2. After my sons becomes a major how do I transfer the MF from my account to his BS.
I cannot show as Gift given as my son is actual Purchaser, I am only the holder as the Guardian.
03 November 2021
1. For all practical purpose, it will be your own capital. You may altogether have a separate ledger as MF of Minor/son, in your accounts, along with minor's savings account.
2. When son attains age of 18, the total capital would be gift to son.
3. Or if you want to segregate his account from your BS, you can keep it separate from the beginning, but don't think it is his account. Any gains or income in the MF/Bank acc. will get CLUBBED in your IT file.
2. When son attains age of 18, the total capital would be gift to son.
3. Or if you want to segregate his account from your BS, you can keep it separate from the beginning, but don't think it is his account. Any gains or income in the MF/Bank acc. will get CLUBBED in your IT file.
03 November 2021
My Pleasure ...
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