hi,
i am a salaried employee in 30% tax slab...i have accumulated savings in SB account which I would like to gift to my parents....please let me know if I trf funds to my mother and create FD in her name, clubbing provisions will apply? should such transfer be supported by any gift deed executed in favour of my mother?
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Gifting fixed deposits to parents
Replies (18)
clubbing provision attracted only in case of spouse and son's wife. FD in name of mother won't attract clubbing provision u/s 64. Since it's gift received from relative so 56(2)(x) also won't apply.
yes agreed with nishant sir!!!
I differ with Mr. Nishant...
clubbing provisions will attract as per 64(1)(cii)
clubbing provisions will attract as per 64(1)(cii)
Yes! Agree with Mr. Nishant!
Mr. Rama Krishnan can you please explain your point of view??
PLS have a look of this sub section to 64
[vii] to any person or association of persons from assets transferred directly or indirectly otherwise than for adequate consideration to the person or association of persons by such individual, to the extent to which the income from such assets is for the immediate or deferred benefit of his or her spouse ; and
[vii] to any person or association of persons from assets transferred directly or indirectly otherwise than for adequate consideration to the person or association of persons by such individual, to the extent to which the income from such assets is for the immediate or deferred benefit of his or her spouse ; and
Yes, Totally agree with you about the provision Mr. Rama Krishnan , but in which way are you connecting this provision to our case!?
Section 64(1)(vii) clearly states as under,
E. Clubbing of Income From Assets Transferred To A Person For The Benefit Of Spouse [SEC. 64(1) (VII)]
Income from assets transferred to a person for the benefit of spouse attract the provisions of section 64 (1) (vii) on clubbing of income. If:
- The taxpayer is an individual.
- He/she has transferred(directly/indirectly) an asset to a person or an association of persons. Asset is transferred for the benefit (immediate/deferred) of spouse.
- The transfer of asset is without adequate consideration.
In case of such individuals income from such an asset is taxable in the hands of the taxpayer who has transferred the asset.
Where did you find the benefit of spouse in our case? Yes, the transfer is without consideration but it isn't for the benefit of Spouse!
PLS have a diligent look, the benefits mentioned are for his or his spouse
ALTIMATELY , THE TRANFER OF SOURCE OF INCOME (FIXED DEPOSIT) ALONG WITH INCOME (INTEREST) SHOULD BE CLUBBED IN THE INCOME OF ASSESSEE
The benefits mantioned are for his or her(his/her) Spouse Mr. Rama Krishnan!
Pls correct me in this matter!
And my question is still the same! Pls explain in which way you are linking our case to Section 64(1)(vii).
it is transfer of asset without any consideration to any person (persons includes all individuals including father mother etc) and the income generated out of transferred asset should be assessed in the hands of transferor.
this is my humble view
this is my humble view
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