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Readers' Corner: Taxation

Kuldip Kumar, partner and leader, personal tax, PwC India, answers your questions

Kuldip Kumar 

Can I gift money to my father and minor son? Can the investment in their name earn tax-free income up to Rs 2.5 lakh? Under the Income Tax Act, where an individual transfers any asset (including cash) to his or her spouse otherwise than for an adequate consideration or as gift, the income earned from that asset is considered as income of the transferor for taxation purposes under the clubbing provisions.

Similar clubbing provisions apply in case of transfer of asset/cash to the minor son. However, you will be able to claim deduction of Rs 1,500 per child against the taxable clubbed income. ...

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First Published: Sun, August 14 2016. 22:04 IST