How Does Joint FD Tax Work for Married Couples?

Do you have income tax-related queries?
Please ask your questions HERE and rediffGURU T S Khurana, a fellow member of The Institute of Cost Accountants of India, will answer them.

Abhijit: Sir... I have some lump sum amount and also my mother has some lump sum amount in hand which we got from some NSC savings. So if I want to park all the amount in my MF account, is it a good idea? Actually I mean to say whether it will be more tax against me or it will be better to park money in all family member MF account. In my account it will be easier to handle all the finance. Plz suggest me. I am a govt salary person, not coming in tax regime yet. My mother also not coming under any tax regime. Plan to keep in Debt MF.

It may be more appropriate if you have two MF accounts, one in your name and the other in your mother's name. You can handle both accounts yourself, may be online.

It is likely to economise your tax payments.

Abi: After all income source including STCG and LTCG my turnover in saving account is around Rs 7 lakhs after all cost paying; now my actual income is Rs 3.27 lakh. If I put Rs 30k in ELSS now, should I pay income tax?

You are entitled to deduction u/s 80C of Rs 30,000 invested in ELSS on normal income where special rate of tax is not applicable.

Please note that LTCG & STCG are taxable under special rate of tax.

These details may help you to calculate your tax liability more accurately.

Minal: Let us assume Mr A does a fixed deposit of Rs 50,00,000 in year 2022-25. He earns Rs 8,50,000 as interest on it. Now, on maturity of this FD, if Mr A deposits the same 50 lakh as further FD and the interest amount Rs 7.25 lakhs (after tax deductions) as another FD in his wife's name, on whom will be the income tax liability be and how much?

Mr A would be liable for tax payment on Rs 8.50 lakhs interest earned on the FD of Rs 50 lakhs during the period 2022-23, 2023-24 and 2024-25. The interest shall be declared and tax paid for each year under reference.

When Mr A deposits the amount in an FD in favour of his wife, interest earned on it shall be clubbed with the income of her husband u/s 64 of the IT Act.

Raj: Hi I am holding debt mutual fund bought in 2017 for Rs 50 lakhs now current value Rs 75 lakhs. If I sell @ invest all Rs 75 lakh in purchase of plot, then is tax become zero?

You may avail exemption u/s 54-F and invest in residential house property, subject to the following conditions:

• You will have to invest the total amount of Rs 75 lakhs.
• You will have to construct the plot with in a period of three years from the date of sale of the MFs.

Anonymous: My mother wants to sell her land which is inherited from her father (my grandfather). My grandfather passed away in 2009, so since then my mother became the owner. I wish to know how to calculate the indexation cost adjusting for the inflation to calculate the capital gains realised. Also, what are the possible LTCG obligations and how can she avoid paying it? Is capital gain account scheme valid for selling land/plot to buy a residential property? Please provide your esteemed recommendations. Thank you

Please see when your grandfather purchased the land and at what cost.

If land was purchased after 01.04.2001, then consider the actual cost. Its indexation can be adopted as per IT Act.

If land was purchased before 01.04.2001, then you may take a certificate from the architect regarding its cost. In this case, indexation may be considered from 01.04.2001.

You may plan your taxes by investing the amount of LTCG in the purchase or construction of a residential house within the specified time limit. You also have the option to invest in capital gain bonds and save tax.

Making a deposit in a capital gains scheme is a temporary action. Thereafter you will have to plan your investments as suggested in para four above.

• You can ask rediffGURU T S Khurana your questions HERE.

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