If one have invested some amount in fixed deposit by transferring to his wife and was unaware of clubbing income section and knows about it after some years, how to sort out the taxation.
Occurrences -
- She was working before this investment was done and had some balance from her earnings.
- Post her earnings stopped, she has deposited her earnings including the money transferred from spouse account in fixed deposit.
- Received the interest and filed ITR's with no income basis. 1 year no refund as forgot to declare FD interest in her ITR and for remaining 3 years got it as refund.
Now getting aware of this clause, if one plans to declare this income in own ITR and pay tax at 30% but the taxpayer is not sure
1) how to correct the past trail and is it required??
2) Shall he transfer all money to his bank account and create FD for future?
3) How to separate out her earnings share from current amount?
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Fixed deposit clubbing of income rule
Replies (3)
When was the original FD made?
Any query from ITD?
2 before 4 years when she stopped working and some in duration of past 4 years. No query from ITD yet
Unless any query from department, you cannot rectify earlier ITRs.
You may declare interest accrued over your investment part in your ITR from this AY.
Or if possible, break the FDs upto your investment part and reinvest it from your bank account.
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