vaibhav (student) (253 Points)
27 March 2013One of my friend having salary income (above exempt limit), if he gives this income to his parents (retired - no income) and if they put them under fixed deposit in bank and provide form 15 H for non deduction of TDS on interest.
is it valid practice?
Whether interest income earned upon FD will be clubbed to my friend's income or not?
Please advise.
CA Bhargav Nathwani
(CA in Practice)
(8307 Points)
Replied 27 March 2013
Not valid.........form - 15 H and G for certifact that allow lower diduction of TDS..!
CA BHUMIT SHAH
(Consultant )
(270 Points)
Replied 29 March 2013
IN MY OPINION UR FRIEND CAN TRANSFER HIS INCOME TO HIS PARENTS AS GIFT WHICH IS NOT TAXABLE SINCE IT IS FROM RELATIVE U/S 56.THERE IS NO CLUBBING PROVISION APPLICABLE FOR THE SAME.SINCE CLUBBING PROVISION IS APPLICABLE IN CASE OF TRANSFER TO SPOUSE,CHILDREN AND SONS WIFE AND NOT PARENTS.THEREFORE UR FRIENDS PARENTS CAN INVEST IN F.D AND SINCE INTEREST ON F.D WHICH IS ONLY INCOME FOR THEM IS BELOW EXEMTION LIMIT CAN SUBMIT FORM 15 H AND NO T.D.S WILL BE DEDUCTED
CA BHUMIT SHAH
(Consultant )
(270 Points)
Replied 29 March 2013
| Originally posted by : CA BHUMIT SHAH | ||
 |
IN MY OPINION UR FRIEND CAN TRANSFER HIS INCOME TO HIS PARENTS AS GIFT WHICH IS NOT TAXABLE SINCE IT IS FROM RELATIVE U/S 56.THERE IS NO CLUBBING PROVISION APPLICABLE FOR THE SAME.SINCE CLUBBING PROVISION IS APPLICABLE IN CASE OF TRANSFER TO SPOUSE,CHILDREN AND SONS WIFE AND NOT PARENTS.THEREFORE UR FRIENDS PARENTS CAN INVEST IN F.D AND SINCE INTEREST ON F.D WHICH IS ONLY INCOME FOR THEM IS BELOW EXEMTION LIMIT CAN SUBMIT FORM 15 H AND NO T.D.S WILL BE DEDUCTED |
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