Income tax

Need professional advice on a unique scenario:-

A salaried individual does not make investment in his own name, rather transfers his earning to his/ her father bank account. Entire earning apart from his/her monthly expenditure his transferred to father's a/c. This practice is being followed since years. There is no investment in this individual name apart from PF. 

The father deposits entire money in bank FDs in his own name. 

Now interest income on FD is taxable income of father. 

Please confirm whether the monthly amount which he recives in his bank a/c from his son/ daughter can also be taxed as his income. He receives approx 50k pm.

 

Replies (2)

No, direct relatives, it cannot be taxed

The person is giving taxed income to his father.

The income which is taxed  once cannot be taxed again in father's hand

However the interest earned by father is taxed.

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