Clubbing of Income (1/1)
Clubbing of Income means income of one person is clubbed in hand of other person.
Example: Mr X is working and having income of Rs 20 L per annul and his wife is not working and not having any income during last 10 years. Mr X has transferred one house property in name of Mrs X without sale consideration. Rental income will not tax in hand of Mrs. X but it will be clubbed in hand of Mr. X.
As like spouse if the property or nay assets is transferred to minor child without adequate consideration same rule is applied and rental income is clubbed in hand of parents.
Following income of minor child is clubbed in hand of parents
- Rental Income
- Interest income from Fixed Deposit, Saving accounts etc
- Dividend Income from shares purchased in name of minor child
Be careful while filing ITR if your children have income during the year.
Wait for more Information on clubbing of Income
Watch our video on clubbing of Income https://www.youtube.com/watch?v=vJdwCLjDLcs