Dear Sir/Madam,
My father wants to give a gift of Rs. 1,00,000/- to his daughter in law (i.e. my wife). My wife would deposit the amount of Rs. 1,00,000/- in the PPF account where interest is tax free
So, please tell us that the interest earned will be added to the income of my father and will it be taxable in the hands of my father.
Thanks/Regards
Abhay
According to the provisions of sec 64(1)(viii) such an income can be clubbed in your fathers income.
To avoid clubbing provisions make it 0% interest loan instead of gift in other cases
However if income is not liable to tax then there will be no effect of clubbing provisions.
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