Over a financial year, if I transfer more than 10L to my mother and a FD gets created for the same then can it attract IT notice or is anything wrong in this? I am employed, have taxable income and file ITR, while my mother is a homemaker and file ITR with 0 taxable income.
Yes, a query is raised by ITD over the FD transaction reported by Bank, in the name of your mother...
Remedy... file return of your mother, even if no taxable income...
There is nothing inherently wrong with transferring funds to your mother and creating a fixed deposit (FD) with those funds. However, it is possible that the transfer of funds could be viewed as a gift by the tax authorities, in which case it may be subject to gift tax.
In India, gifts received from certain specified relatives, including mother, father, brother, sister, and spouse, are generally exempt from gift tax up to a certain limit. However, gifts received from other persons or entities may be subject to gift tax.
The tax treatment of gifts received from your mother will depend on the specific circumstances of the gift and the amount of the gift. It's always a good idea geometry dash lite to consult with a tax professional or seek guidance from the tax authorities to ensure that you are in compliance with the relevant tax laws.
@ RobertMrupe sir, I think you understood the question other way round, it is son transferring to mother.
"are generally exempt from gift tax up to a certain limit." --> what is the limit?
@ DhirajlalRambhia sir, ITR for mother is filed and interest generated from the FDs is accounted/filed as "Income from FD". So, this makes everything good or is anything wrong which needs to be taken care?
That's OK. If required, you may need to prepare gift deed for the 10 lakhs gift.
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