Joint bank a/c includes transactions by the 2nd holder

A/c entries 567 views 5 replies

Suppose, a person is involved in a profession (sole proprietorship) and using a savings bank a/c for making transactions related to his profession where he and his wife is the joint holder. The person is the 1st Holder.

In that case, if such a/c got credited with substantial amount related to his wife (2nd holder), how this amount will be treated in the accounting books of such person, as he is showing this bank a/c in his balance sheet?

Further, how this amount will be dealt with for computing income tax liability of such person?

Replies (5)
Hi that fund is business related or other than business income.
it's my opinion that in case of joint holder account first holder is main accountability. how ever certain transaction which are indentified of her wife is the second holder should be computed income of wife , and that taxability should impose in the hand of wife.
Nothing to worry about the account holder...
Keep Your books of accounts as per who got income and the deposits. Then you can compute the income as per who is earn that income...


Advisable for open a Separate account.
Yes it's good I agree with above answer.

The person is showing the bank balance in his balance sheet. So, to reflect the actual closing bank balance the person has to consider such amount also in his books of accounts, right? My question is that only, how he should consider this and what accounting treatment to be done in his books of account? 


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