*Taxability of the Resident Welfare Association*

The Resident Welfare Association's only source of income in both years was interest from fixed deposits totaling less than Rs. 8 lacks in both years.
AOP filed an IT return for the AY 2020-21 and 2021-22, paying 30% tax + cess on interest income.
Now received Intimation from the IT department that a 37% surcharge has been imposed on the 30% tax.
Querry?
1. Is interest income exempt from taxation under the Mutuality concept?
2. Charging a 37% Surcharge is valid in law.
3. Filing rectification on the e-fing website will result in a favorable outcome, ie, surcharge waiver?
4. Is there any way to avoid paying the surcharge?
I really anticipate hearing from you.
Replies (2)
Quick Summary
This discussion addresses the taxability of interest income earned by Resident Welfare Associations (RWAs) from fixed deposits. It clarifies that while interest income isn't typically exempt under the mutuality concept, a 37% surcharge may be applicable, especially when individual member shares are unknown. The thread explores the validity of this surcharge and suggests rectification filing as a potential avenue for waiver, particularly if individual member shares can be clearly established.

1. No.

2. Yes. at MMR, when shares of individual member is unknown.

3. Can be, if the assessment of AOP can be rederived.

4. Rectification with respect to known shares of each member.

Refer :: https://wirc-icai.org/wirc-reference-manual/part3/taxation-of-association-of-personsaop-body-of-individuals-boi.html

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
ARTICLESHIP 20 October 2026
CA ARTICLE

AMKN & CO

Noida

CA Inter

View Details
Company
ARTICLESHIP 07 October 2026
Article Assistant

Malhotra Rajesh & Associates

New Delhi

B.Com

View Details
Company
10 October 2026
Accounts Associate Level 1

Abic and Mani Chartered Accountants

Kottayam

B.Com

View Details
Company
21 October 2026
CA INTER/ BCOM WITH EXPERIENCE

CA S KUMAR GUPTA & CO

Amritsar

CA Inter

View Details
Company
16 October 2026
CA article trainee

Zerdi & Co. Chartered Accountants

Pune

CA Inter

View Details
Company
13 October 2026
Accountant

Zerdi & Co. Chartered Accountants

Pune

B.Com

View Details
Company
ARTICLESHIP 01 October 2026
Articled Assistant

KPSN & Associates LLP

Chennai

CA Inter

View Details
Company
30 September 2026
Senior Accountant

Codeboard Technology

Chennai

B.Com

View Details