Clubbing rules - What to do with money ?

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25 Points Posted on 03 April 2023

Here is the scene,

Mr. A (NRI) purchased a house in his wife's name, Mrs. A (NRI). The property cost 20 lakhs, and they borrowed 15 lakhs through Joint Home loan (5 lakhs were paid from Mr. A's savings account). in December 2020

In 2023, Mrs. A will sell the house and receive the 25 lakhs.

first enquire

How much capital gain and clubbing income should be reported on both individuals' ITRs in 2023–2024 how to show them in both person ITR

Second question

Now that Mrs. A has 25 Lakh, will giving this money as gift to a intimidate family member (brother in law or mother in law ) will attract any taxation to receiver ?

If Mrs. A invests these 25 lakh in Fdr or shares and earns, let's say, 2 lakh per year, will the 2 lakh also be clubbed with the husband income or not ?

Replies (3)

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

211643 Points Posted on 03 April 2023

1. In case the amount of Rs. 5 lakhs be treated as loan and being repaid to husband, no clubbing provision gets attracted.

2. After payment of loan and releasing any long-term capital gain liability, she can gift the balance amount to her BIL without any tax liability.

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25 Points Posted on 05 April 2023

Originally posted by : Dhirajlal Rambhia
	1. In case the amount of Rs. 5 lakhs be treated as loan and being repaid to husband, no clubbing provision gets attracted. 2. After payment of loan and releasing any long-term capital gain liability, she can gift the balance amount to her BIL without any tax liability.

Thank you very much for your responses to everyone.

I have another query

NRI spouse paid off the entire loan, So wife have to repay 20 Lakh. plus interest ? also not made a legal Loan Deed is that okey ?

If she receives 25 lakhs from the sale of her home and she invests that sum in FDR. Would the interest she receives be clubbed with her husband's income?