20 June 2010
I had made fixed deposit worth Rs.5 lac in my wife's name in Dec. 08 from my retirement benefits. I came to know that interest on above FD will be clubbed in my income. Is is true? Subsequently, for some requirements my wife obtained loan against above FD. Please advice me whether accrued interest on FD will be clubbed in my income and if so whether any rebate or reduction of interest paid on loan against FD will be allowed. The loan was taken for some urgent domestic requirements and not for acquisition of another assets.
21 June 2010
Yes interest on FD at time of Maturity will be clubbed in your income... and wont be taxed in your Wifes hand... Please note that it is beneficial to offer Interest for tax on maturity although you can tax it on accrual basis.... And please ttell for what the loan is taken for?
CAclubindia
