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Property purchase in huf


Pushan Sikdar   21 June 2017

Pushan Sikdar

 3 points

| My Other Post

Hi, I have a following query. Can I open a HUF and earn income in it through derivatives and long term capital gain ( equities). The income earned will be HUF income and on which I will pay the taxes. Over the time can I use the income earned in HUF to buy a property and property would be in the name of HUF. This way the rental income would be of HUF only. My questions 1. Can the derivative income (business income) in HUF be taxed as HUF and will not be clubbed with my income? 2. Can the equity income (long term capital gain) in HUF be taxed as HUF and will not be clubbed with my income? 3. Is it a good strategy to buy a property in HUF name and earn the rental income in it to save on the tax? 4. Is it better to buy a property in HUF name?

avater

Dhirajlal Rambhia (KVO Merau Kutchh)     21 June 2017

Dhirajlal Rambhia
KVO Merau Kutchh 
 9230 likes  93355 points

View Profile | My Other Post

1. Yes

2. Yes

3.& 4  Yes........if ready to divide capital amongst family.

Main point is initial capital formation.............as any gifts from its members gets clubbing provision ......

refer: capital-formation-of-hindu-undivided-family-huf

avater

Pushan Sikdar   21 June 2017

Pushan Sikdar

 3 points

View Profile | My Other Post

Capital can be a loan at interest rate from karta. Will that also require clubbing

avater

Dhirajlal Rambhia (KVO Merau Kutchh)     21 June 2017

Dhirajlal Rambhia
KVO Merau Kutchh 
 9230 likes  93355 points

View Profile | My Other Post

No. Clubbing provision is applied when any tax liability is being transferred.


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