Tax to income earned from fix deposit

TDS 154 views 5 replies

Here is my question about Income tax saving approach on income earned from Fix Deposit

 

Let say i fall in bracket of 30 % tax slab . so whatever the income that i earn using fix deposit of my income tax paid money , I have to pay 30 % to the govt . 

 

Instead what i do . I tansfer my tax paid money in mother's account (Consider Gift to mother) and earn interest on it where my mother just need to pay 0-10 % of tax on interest earned . Later on my mother can gift me back all this money . Is it correct .?

Is there any limitation of amount that i can transfer in my mother's account .

Does it require any legal procedure to transfer my money in mother's account as part of gift .

Replies (5)

Good calculation.

No gift tax, nor clubbing, nor even any limit of Gift amount.

Simple gift letter with any 2 witnesses, and transfer  by bank instument sufficient.

Only risk in general, risk of any other legal heirs of your mother. (just intimation).

@ Dhirajlala Thanks for your reply . 

One more thing here..

Instead of gifting , can i say  that  i have given loan to my mother of x amount .. Now she is earning interest on it , and paying tax accordingly in her income tax slab.. I will take this money back whenever i need. ( No documentation required if i am only heirs of my mother  or i believe her) 

Am it correct.

Just to confirm

 does the clubbing rule apply if person gift money  to daughter in law 

1. During cross verification, AO can treat is as diverting of income over mother's account and can assess the income in your hand.

2. Yes, clubbing provision apply in case of DIL.


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