Me & my wife have certain FDs in Bank. To alleviate lesser tax/no tax, can we transfer FDs among ourselves so that net tax on the interest income of respective individual will be less or NIL. If so, how this transfer will to be treated i.e., as gift or so & any document(s) required to be kept for future reference for effecting such transfer of deposits? I'm a pensioner & my wife a Home Maker.
Estimated interest around 3.83L for me & 97K for my wife, both Sr.Citizens, 70 & 66 years, me also getting around 3.22L pension from my ex-employer & dividend from Equities & MFs around 75K for me.. My wife doesn't have any other income.
I have exhausted 80C to the full extent & this FY 2021-22, my Taxable income crossed 5L , after all deductions 80D, 80TTB etc &still I'm paying around 15K tax, whereas my wife's Taxable income comes around 2.83L, so she need not pay tax. Hence want to shift some deposits in my name to her name. How can this be done professionally & without any legal or tax implications. Please advice me.
Yeah, recently some deposits were transferred into my name, which I can re-tranfer now, when some deposits of mine are due in the near future. What's 'Clubbing provisions'? I don't get it.
If the funds are belongs to you and if you transfer to wife just to minimise the tax then the interest from those funds will be taxed in your hands as per clubbing provisions..
CAclubindia
