a minor receives interest income from his father which exceeds the limit for tds...does his father deductn tds and wht will b the impact of clubbing
2 Replies
Amir
(Learner)
(4016 Points)
Replied 10 April 2010
HI Joni,
Interesting one..........!
Where payment is made by a resident in his individual capacity to another resident then TDS provisions are not attracted.
In other words TDS provision in case of payments to residents by a resident Individual/HUF gets trigerred on fulfilment of following two conditions -
1) When Payment is made in course of business or profession
2) Previous year receipts of the payer exceeds the threshold limit u/s 44AB.
So if payment is made only in individual capacity then TDS shall not be deducted & yes income will be clubbed with the parent.
However interesting thing is where TDS provisions gets attracted upon fulfilment of above condition -
1) Yes TDS will be deducted.
2) Interest wil be clubbed
3) Father will be allowed to take credit of TDS.
4) Keep in mind 40A(2)
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