03 May 2013
sir, i have made fixed deposit say 2 lakhs in the name of minor chiild two years back. The deposit matured. Now I want to renew the said deposit. But the bank has held up the renewal of said deposit and the bank is asking separate pan card for minor child. My query is why separate pan card of minor child is required for renewal of deposit. Under which section of I.T. ACT I have to submit separate pan card of minor since i am not taking the redemption of deposit from bank. I have already submitted my pan number and 15-G to the bank. kindly clarify whether the bank is correct. I think at the time of redemption of deposit the bank may ask separate pan of minor. but for renewal of deposit why separate pan is required and under which section.
04 May 2013
Bank need to deduct TDS on interest Accrued on FDRs under Section 194A of Income Tax Act and for that purpose, it requires PAN. It means even if Interest is not PAID , it is credited to your FDR account. As FDR is in Minor's Name, they might ask for seperate PAN.
In case PAN is available, bank is requried to deduct 10% of inerest credited to your account. You can take credit of this TDS in your personal income tax return.
In case PAN is not available, Bank is required to deduct 20 % of interest credited to your account and you can not take benefit of this tds in your personal income tax return.
However, in case you have already submitted Form 15G, there is no requirement for them to deduct tds.
To be on safer side, you may apply for PAN of minor and can provide to bank. Any tax deducted by bank can be taken as refund from income tax by filing seperate income tax return of minor.
04 May 2013
THANK Q BANSALJI, INCOME OF MINOR HAS TO BE CLUBBED WITH THE INCOME OF PARENT U/S 64, THEN HOW CAN WE FILE SEPARATE RETURN OF MINOR CHILD TO GET THE REFUND OF TDS DEDUCTED BY BANK WHICH IS CREDITED TO PAN OF MINOR CHILD AND REFLECTED UNDER 26AS IN MINORS PAN
CAclubindia
