I want to loan certain amount to my wife who is a home maker with a reasonable interest rate and also by making an loan agreement. I have following small queries.
1. What interest rate should I charge?
2. If my wife invests this money at 6.5% interest rate and gives me 5% interest PA, then will this income of 5%, be my income? If I charge lower interest rate then I will get a lower income, but is this valid?
Second point, I wish to highlight here that if I gift my wife a certain amount and she invests else where and income generated will be my income and this income if she invests elsewhere, it will be her income. [ at second level income does not club ].
What would be the best way to do it. Please help. Thank you.
CAclubindia
