FD Interest

In Case, the taxable income of your wife is below taxable limt, then in case there is no need to file return and so nothing with the interest income. Just take it and enjoy.......no need to pay taxes or doing anything from Income Taxes point of view.

Regards

According to me the amount of interest received on the FD will be clubbed in the income of the husband as per clubbing provisions [Section 64] because the amount of FD is given by the husband and not by the wife herself.

Yaa sudhansu is right,

UNder  Income tax Act there is specific section 64(1)(iv) under which  an individual is assessable in respect of income from assests transferred to spouse 

In ur case, u transferred cash into the FD of ur wife and on which interest will be received  . In this case u will be taxable for the interest income of FD

if FD made by a person on his wife name, It can be treated as gift because on maturity date amount of FD will only be received by his wife and interest will also received  by her, So As per me, Interest Income will not be clubbed.    

Dear Mahendra

As per rules of IT Act/CBDT every person having GROSS INCOME above the limit of exemption limit have compulsoty to file the return

if its below exemption limit than no need to file return

For Eg in current year if my Gross Income (before deducting benefits u/s 80c - 80u) is below 160000 or upto 160000 than i dont have need to file return

but suppose my income is 180000 and 80 C deduction is 30,000 than Net Taxable income is 150000 in this case i have to file my return because gross is above exemption limit.

Regards

Dear Mahendra,

As per clubbing provisions, only Income is to be clubbed, income on income is not be clubbed (interest on fixed deposits in your case).

Secondly, if it is not a case of transfer, a person can file Form 15G for non deduction of TDS if the interest on fixed deposits is the only income to the assessee.

Lastly, a person will be liable to get TDS deducted @ 20% if he/she is not quoting PAN.

Therefore, It is advisable to have PAN to avoid such over deductions.

Trust this clarifies.

Pl. do revert if further clarification is required in this regard.

Best Regards,

CA.Sanjay Chopra

91-9818155004

i m completely agree with Nitin Grover

Dear mahendra,

i totally agree with shudhanshu agarwal. clubbiung provision will get attracted.

Regards

Kanti Jain

I do agree with Sudhanshu Aggrawal and Daya Shankar Singh as the amount of interest on FD will be clubbed according to section 64(1)(||).

Thanks Members for your Valuable advice.

I also agree that income on money transferred is to be clubbed in the hands of  transferor if any amount of money is transferred without any consideration but can form 15 G be filed in that case for no deduction of tax ?

or what if  it is not shown by the husband in his return of income since he is a salaried employee?

please advice.

As FD is on the wife's name so PAN quoted should be of his wife. As you have mentioned that his wife doesnt have PAN then according to new provisions of section 206AA TDS will be deducted @ 20%. So it is better to ask his wife to apply for PAN and then fill Form 15G as declaration that she is not liable to pay any tax to the Government.

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clubbing provision is attracted hence u will be liable to pay tax on this interest income. and dear all who are not agreed with this point then plz tell why it is not clubbed.according to ur view it can become a better tax planning.but income tax dept. is not fool as u think