Mr. X is having an income of Rs. 15 lakhs and his wife has income of Rs. 2.5 lakhs.
Wife had deposited Rs. 6 lakhs in the name of their 2 children out of her income in AY 06-07. The FD has matured in Ay 11-12 on which they received an interest of Rs. 1 lakh.
The children had no other income in the previous years and the marriage of parents subsists. Mr. X wants to tax the interest along with his wife's income.
Is there any provision/case laws allowing the minor's income to be taxed in the hands of parent with lower income??
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Clubbing of minor's income
Replies (5)
Income of minor is Clubbed with the parents income to whom income is higher
the exception of this rules is that income of minor is on his personal skill than it taxble in his hands
| Originally posted by : Meena George | ||
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- as the funds were gone from wife's account through banking channel so she had shown the same in her ITR clubbing the children in her hands, so what is prob to receive the interest and club it with her income? |
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AS FD was made in 06-07, so there must be accured interest on the FD, and wife has added that in her ITR, so now at encashment , we dont feel that there is any prob with incometax.
Interest accrued was not taxed in previous years..
ideally accrued interest should have been taxed in the previous years... even if the same has not been offered, offer them for taxation in the current year on receipt basis..
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