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Taxation of apartment association

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Sreevidhya V

335 Points Posted on 30 June 2022

hi all,
one apartment association paid tax on interest earned on fd income at 30% + 4% surcharge
but they have received notice stating tax rate at @ 42.744% along with interest on this
is rate of tax for apartment association is 30% or 42.744%? income of association on interest income is less than 2 lacs only.
pls advise

Replies (2)

Quick Summary

This discussion clarifies the tax rate applicable to apartment associations on their interest income from Fixed Deposits. It addresses a query where an association was charged 42.744% tax, when the expected rate was 30%. The advice given is that 42.744% is an incorrect rate and the basic exemption limit of ₹2.5 lakhs should apply if the association is considered an AOP (Association of Persons) with fewer than 32 members, provided certain conditions are met.

rama krishnan

5751 Points Posted on 01 July 2022

Ma'am, at any instance, the tax rate can't be @ 42.744%. what's the status of ASSOCIATION I. e. AOP, boi, LLP etc. apart from company firm LLP, boi and AOP (subject to certain conditions), for rest of the class of persons, there's no tax liability if total income is less than 2.5lakhs