SATHEESH (Student) (147 Points)
13 March 2015Hai,
I have querry regarding clubbing of provisions.
One of my client (Mrs X) has Fixed Deposit in bank in the name of her Minor Son. Bank has deducted tax at source from interest paid to the minor son and issued TDS Certificate. Now the while filing Income Tax Return of Mrs X , her son's income has to be clubbed together.
Is it possible to claim the TDS of her son in her IT Return? If yes , how?
Thank You
Vishal Goel
(Chartered Accountant)
(1688 Points)
Replied 13 March 2015
Vishal Goel
(Chartered Accountant)
(1688 Points)
Replied 13 March 2015
SATHEESH
(Student)
(147 Points)
Replied 13 March 2015
Thank You.
It is possible to claim the credit of such TDS. What is the procedure to claim that TDS while e-filing of IT Return?
SATHEESH
(Student)
(147 Points)
Replied 13 March 2015
Dear Vishal,
What is your opinion about the following indirect procedure
1. Clubb minor's income with mother and file Return without claiming Minor's TDS
2. Minor filing Return without any taxable income claiming refund of the entire TDS.
J. K. Ratan
(Compliance Advisor)
(794 Points)
Replied 13 March 2015
Dear Frnd
You need to Club her son's Income in hes total Income. As Mr. Vishal said she is not eligible to considered TDS amound of her son in her IT Return.
But She can take the benefit of TDS Deducted by bank on FD amount of her son by Filing his Individual Return after showing his nill income.
Vishal Goel
(Chartered Accountant)
(1688 Points)
Replied 14 March 2015
Hello, Request the deductor to file the revised TDS return so the tax will be reflected in mother’s name in 26AS.
AKASH THOBHANI
(Article Clerk)
(62 Points)
Replied 27 March 2015
Hi,
I have the same query as above. For AY 2012-13, suppose a minor's income is clubbed and the TDS on Minor's Income has been given credit for. But, the AO has not allowed the credit for such TDS and has raised a demand. I am searching a case law in favour of assessee.
I found the following while searching :
1. Some Notifications have been issued by CBDT in favour of the Assessee as per the following link :
https://www.wirc-icai.org/faq.aspx
I tried to find out the notification and I could not find the words as mentioned in WIRC. The Notifications can be found at the following link :
https://www.incometaxindia.gov.in/Pages/communications/notifications.aspx
2. I found at CA ClubIndia Website, a CA has commented seven months ago that there is a notification on the above issue.The link is as follows :
/forum/clubbing-minor-child-s-income-300255.asp#.VRTyb_yUdA0
Please give a solution because provision is not clear for the TDS and there is no scope for filing different returns and claiming a refund at one place and not claiming TDS in the income of Father.
Awaiting your reply.
Thanks in advance
SUNIL
(student)
(24 Points)
Replied 09 June 2018
Hi,
Please read the below example, this is the only way, nothing else
Example: Mr. A has transferred Rs. 50lacs to his wife account and wife has invested in FDR and bank has deducted TDS on the same. As per clubbing provisions of sec. 60 to 64 of Income Tax Act, interest income of wife will be clubbed in the hands of husband due to transfer of amount without adequate consideration or in connection with an agreement to live apart. Bank has issued TDS certificate in the name of wife. Here, income from FDR shall be included in income of Mr. A. however, due to mismatch of 26AS, Mr. A will not be able to claim tax deducted by bank on such income. In such situation, Rule 37BA, Clause 2(i) provides that “If the income on which tax has been deducted at source is assessable in the hands of a person other than the deductee, credit for tax deducted at source shall be given to the other person in cases where the income of the deductee is included in the total income of another person under the provisions of section 60, section 61, section 64, section 93 or section 94. Provided that the deductee files a declaration with the deductor and the deductor reports the tax deduction in the name of the other person in the information relating to deduction of tax.” The said declaration shall be filed by the deductee stating the name, address, permanent account number of the person to whom credit is to be given, payment or credit in relation to which credit is to be given and reasons for giving credit to such person. Thus, if you encounter any such situation then a declaration by deductee shall be given to deductor before deduction of TDS. If this procedure is followed then during filing of return this issue can be avoided. However, in case if TDS has already been deducted by the bank then deductee shall approach bank to revise the return filed. As we know that this might not be possible practically thus, in such case we are left with the option to club the income and on the other hand deductee shall file its NIL return and claim the TDS refund. In this process, you may receive notice from the Department. In reply to notice, you need to prove that income was clubbed with the income of husband. The Act provides for clubbing of income but no provision made regarding claim of TDS on the same. Due to this default, assessee faces problem in clubbing income and filing return. Therefore, department shall make changes in the process of filing return regarding clubbing and claiming TDS on same. so be cautious while clubbing income if TDS deducted.
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