Rental income on inherited property

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If you're receiving rental income from an inherited property and it's increasing your tax burden as a salaried individual, you might consider forming a Hindu Undivided Family (HUF). By transferring your share of the rental income to the HUF, with yourself as Karta and your wife and son as members, you could potentially simplify your tax filing and manage your liabilities more effectively. It's advisable to consult a legal expert to ensure the HUF is established correctly before transferring your inheritance rights.

Rakesh

Rakesh (Querist)

14 June 2022 I have rental income from inherited property. The property was on the name on my grandmother and is on rent. I receive portion of the rent after death of my grand mother and my father which increased my tax liabilities being salaried person.

Can I create a HUF, me as karta and my wife and son as members and give pan number of HUF for transfer of my portion of rent into HUF account? Will it work to avoid the additional tax and simplify my ITR filing just using FORM 16 i received from my employer.

Dhirajlal Rambhia

Dhirajlal Rambhia

(Expert)

16 June 2022 Yes, it is possible with division of your inheritance rights in the property in HUF favor, provided the HUF created before the date of transfer of such rights. Need to consult local legal advisor before any such decision.

Rakesh

Rakesh (Querist)

20 July 2022 Thank you Dhiraj Sir for your help as always.

Dhirajlal Rambhia

Dhirajlal Rambhia

(Expert)

20 July 2022 You are welcome...

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