NITINBHAI PATEL (B.Com) (192 Points)
27 December 2016
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177896 Points)
Replied 28 December 2016
When you send your tax (paid in USA) paid USD to your sons in India by bank transfers, whatever be amount, and how-so-ever frequently, what your sons receive from their parents is not income, and is not taxable in India.
Either of them can show/declare the amount received as gift/loan from their parents.
NITINBHAI PATEL
(B.Com)
(192 Points)
Replied 28 December 2016
thank your sir.
but here his parents is not PR of their.
and they want to show whatever amount received as legally in india and ready to pay tax.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177896 Points)
Replied 28 December 2016
Will you please clarify some points?
The son is Resident of India?
Parents are Non resident of India and earning income in US?
They want to send some amount which is tax paid in US?
NITINBHAI PATEL
(B.Com)
(192 Points)
Replied 28 December 2016
yes.
1. both son is resident of india.
2. yes parents are earning income in USA. (before 2 years go)
3. no. parents are not on PR basis. so no tax deducted. as they are working in private stores.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177896 Points)
Replied 28 December 2016
Well, the amount is income earned in US, earned about 2 years ago, and now its savings in their hands?
NITINBHAI PATEL
(B.Com)
(192 Points)
Replied 28 December 2016
no....sir...
he went 2 years back...
form now evry months they wants to send 2 lac rs. to their sons ....in india
from this received money their purpose is below mentioned
first purpose is to buy new house in india.
secondly in future sons want to go U.K. ....
so they want to show their received money as a legally in india and make stronger their return for future reference.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177896 Points)
Replied 28 December 2016
I want just clarification about the money, which is to be sent by parents, i.e, 2 lakhs every month, what is its source?
NITINBHAI PATEL
(B.Com)
(192 Points)
Replied 28 December 2016
parents are working in MOTELS.
and they are getting their salary after tax deducting.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177896 Points)
Replied 28 December 2016
" parents are working in MOTELS. and they are getting their salary after tax deducting."
This is just I wanted you to re-collect.
So, that is the income of parents, which is already tax paid in US.
That money when you send though bank transfers in India to your son's account, it is tax-free gift to your son.
He can show that amount under exempted income while filling his ITR. No tax liability will arise on such declaration.
Slowly and steadily, ( may be amount invested in FD or MF etc.) it will accumulate to sizable capital, when he can invest it in house property.
All the best.
NITINBHAI PATEL
(B.Com)
(192 Points)
Replied 28 December 2016
thank you sir.
it means every month if he send 2 lac rs. ....means yearly 24 lacs rs. to his sons...then no need to worry about taxation.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177896 Points)
Replied 28 December 2016
Yes, not to worry at all; provided the money sent by parents should be through bank transfers/channel and that amount is tax paid/deducted in that country (US). That amount will be tax-free gift to the son in India.
NITINBHAI PATEL
(B.Com)
(192 Points)
Replied 28 December 2016
one of my client...who is building contractor. he is receiving income from construction work. now he had paid rs.2 lac to abc construction as a his part in one of the building scheme of abc construction. so how will we make entry of this transaction?
NITINBHAI PATEL
(B.Com)
(192 Points)
Replied 23 April 2017
CAclubindia
