Income tax clubbing when husband and wife both are pensioners

Husband and wife both happen to be pensioners.

Husband gifts wife, X amount of money or, vice versa.

Wife/Husband then opens FD with that X amount obtained as gift and sources some amount from his/her own funds, say Y.

So,... FD principal = X (gift) + Y (own)

Will clubbing provisions apply on the interest earned?

Replies (7)
yes. only on gifted amounr

Even when both are earning independently and on individual capacity?

He or she whomever has gifted can club only the gifted amount with the person having or showing more income compared to each other. .
can you be clear with your statement earlier both where pensioners not earning independently. ..what ever be the case the above treatment is suggested
Originally posted by : Sunil Sharma
He or she whomever has gifted can club only the gifted amount with the person having or showing more income compared to each other. .

 

Husband and wife both are pensioners and are earning independently and on individual capacity. Both are separate tax assesses and have been filing returns.

1] Husband gifts Wife, 'X' amount

2] Wife does FD with 'X' and earns 'Y' amount as interest on 'X'

Gross income of Husband = 20 lacs

Gross income of Wife = 15 lacs

'X' as gift won't be subjected to taxation.

But the interest earned i.e., 'Y' will be added to whose income?

Yes Clubbing applicable only in respect of interest earned on gifted amount.

'Y' will be clubbed with the income of husband. assuming that 'Y" is the interest earned on "X' i.e. the amount which was gifted by husband to wife as clubbing provisions are applicable only on income earned on investment of amount gifted. 

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