I have some taxable bonds/NCDs in my demat account. I am in 30% bracket.
To save taxes, can I open a demat account in my minor child's name and gift some of the NCDs to her demat account.
Will this come under "clubbing of income"?
In the future, can my child gift the principal back to me and keep the interest portion of it.
The income arising from bonds/NCD shall be clubbed with your income.
Yes, even such income will be clubbed as the same is not earned by minor on account of some skills etc.
As per section 64 (1A) , it will be taxable as part of your salary.
Yes Clubbing Provision is applicable
| Originally posted by : Rajesh M Patel | ||
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Yes Clubbing Provision is applicable |
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Thanks for your replies.
In future, can my child gift me the principal back or there will be some tax on that gift?
If the son give gift to father, Taxability will not arise.
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