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INCOME TAX RETURN
Recently, I read in the paper that Indian citizen have to declare their holdings in any foreign country from the Assessment year 2012-13. My close relative is settled in Australia and working there in a software company, earning a salary of about One Lacs aus $ and has a residence building and all members of the family are overseas citizen of India by having Dual citizen of AUS. and INDIA. Kindly advise about the declaration of assets and holdings as read in the paper. [firstname.lastname@example.org]
- For the Assessment 2012-13, it is mandatory for resident assessee to file the Income Tax Return if he/she has any foreign assets. The filing is mandatory even if there is no taxable Income or even if the income is below the applicable basic exemption limit. The assets covered include bank accounts, immovable property and interest in any company. The taxpayer will have to mention the peak bank balance in his account during the year as well as the total investment in other assets at cost price. Further, the details country name, address of the bank, etc are also required to be mentioned. It is applicable only to resident assessee.
- The definition of the term “resident” as per Income Tax Act would be relevant. In such a situation, the term resident would need to be read as including “not ordinarily residents” as well. Presence in India of more than 182 days during a financial year or 60 days along with a cumulative stay of more than 365 days in the preceding four years, will trigger a “resident” status in India. Residents but not ordinarily residents (RBNORs) are exempted from this reporting requirement.
- The return in such case can be filed in ITR-2 or ITR-3 or ITR-4 depending upon the nature of income. E-filing is mandatory in such case. [Notification No. S.O. 626 (E) Dated 28.03.2012]
Please clear my doubt with regard to the Tax Saver Fixed Deposit in a bank. Earlier, the maturity period of the said amount was Five years. In the budget speech of the FM, most probably, it was suggest to be reduce to three years. Kindly confirm about the time of deposit as well as the maximum amt. that is fix deposit under TAX Saver.
[Manohar Selot, Nagpuremail@example.com]
There is no reduction in the maturity period of FD eligible for deduction u/s 80C. The period is same at 5 years as earlier.
FD’s are create in Wife’s name from cash gift to her by husband. In whose hand the interest earned be chargeable, Husband or the Wife? The wife has additional rental income but the overall amount (Rent + Interest on FD’s) is less than Rs 1,90,000/-.
Where an asset (which includes cash/cheque amount also) is transferred by an individual to his or her spouse, directly or indirectly, otherwise than for adequate consideration or in connection with an agreement to live part, any income from such asset will be deemed to be the income of the transferor –[Section 64(1)(iv) of the I.T. Act, 1961]. The income from the FD’s done by wife out of the cash gift from husband, accordingly, will be taxable in the hands of her Husband.
I am willing to gift part of my retirement fund in the form of Cash to my Wife. Please let me know whether the cash Gift is taxable? Also, let me know in whose hand the Bank interests received on gifted funds are taxable? Present income of my wife is not taxable & whether the provision of clubbing of Income will be applicable in this case? [firstname.lastname@example.org]
Cash gift in between relative is not taxable as such. Clubbing provisions, as already elaborated above, is applicable in such case & the income .would be clubbed with the income of the Husband.
INCOME TAX RETURN
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