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Is this taxable

Situn (Internet Marketer) (31 Points)

25 November 2014

From some online marketing I'm getting Rs.60,000/month and transferring Rs.30000/month to my friend. So in this case I will pay all the income tax for Rs.60000/month or for Rs.30000/month only ? Im transferring by NET [online banking]

Please help

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5 Replies

CA Abhilasha Bhagat (ACA) (466 Points)
Replied 25 November 2014

Its your income and taxable in your hands only.

Further, as you have transferred amount to friend's account, it will be in the nature of loan.

If its gift; then it will also be taxable in the hands of your friend under the head 'Income from other sources'.

Situn (Internet Marketer) (31 Points)
Replied 25 November 2014

Originally posted by : CA Abhilasha Bhagat
	Its your income and taxable in your hands only. Further, as you have transferred amount to friend's account, it will be in the nature of loan. If its gift; then it will also be taxable in the hands of your friend under the head 'Income from other sources'.

Thanks for the quick response. But this is the share value for him not loan. So in this example if I will pay tax only for Rs.30000/month aswell my friend will pay for Rs.30000/month. So any problem doing that ?

Gourav Gupta (Working in CA Firm) (671 Points)
Replied 25 November 2014

According to situation explained by you, one possible answer is- it is better to enter a partnership agreement between you and your friend. after that entire amount of Rs. 60,000 pm I.e. 720000 per annum paid tax under section 44AD @ 8% and after that share balance amount equally. this amount (balance after tax) will not taxable either in your hands or your friend hands.

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