Clubbing of Income in Direct Taxes
Learn about clubbing of income under Direct Taxes, where income transferred from one person to another is deemed taxable in the transferor's hands. Explore the rules, exceptions, and specific scenarios where income is clubbed, such as remuneration of spouse and income from gifted assets. An illustration further clarifies this concept.
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Presentation Transcript
ST.PAUL JUNIOR & DEGREE COLLEGE TAXATION- III DIRECT TAXES DINESH MOTWANI LECTURER
CLUBBING OF INCOME (SECTION 60-65)
INTRODUCTION Under section 60 Income arising to any person by virtue of any transfer of income assets remaining property of the person, who make the transfer , is deemed to be the Income of transferor and is taxable in his hands. It will not make any difference whether transfer is revocable or irrevocable or it was affected before or after the commencement of the Act. There is no exception to this rule , transfer under a settlement , trust, covenant, agreement or arrangement are also covred by this section.
INCOMES TO BE CLUBBED 1. REMUNERATION OF SPOUSE 2. INCOME FROM ASSETS GIFTED TOSPOUSE 3. INCOME FROM ASSETS GIFTED TO SON SWIFE 4. INCOME FROM ASSETS GIFTED TRANSFERRED FOR THE BENEFITS OF THE SPOUSE. 5. INCOME FROM ASSETS TRANSFERRED FOR THE BENEFIT OF THE SON S WIFE 6. INCOME OF MINOR CHILD 7. INCOME FROM OWN PROPERTY CONVERTED INTO PROPERTY OF HUF.
ILLUSTRATION :1 Mrs Dilwala who has passedFY Arts examination of the Mumbai university works as a receiptionist at her husband Dr, Dilwala s heart clinic. Dr.Dilwala claims that her salary should not be clubbed with his professional income on the following grounds.
