Transfer money to wife's account
I am a NRI residing in Netherlands with my wife.I transfer my savings to a NRE account in India.I wanted to know that If I transfer big sums of money to my wife local indian account from NRE account are there any tax implications.If Yes what can I do about it.
Asked 3 years ago in Income Tax from Mumbai, Maharashtra
Since your income is not taxable in India, transfer of funds to your NRE Account is not taxable provided the same is not received directly from your employer in to Indian Bank Account.
Transfer from your NRE account to your wife's account to may be treated as loan given to her or gift given to her. In both cases it does not result in any income to her. Hence there is no tax implication to any of you.
It is possible that there may be a query to your wife for the amounts credited to to her account. However, the same can be explained with facts.
Interest received by her on the amounts transferred by you to her account may be clubbed in your income under clubbing provisions and will be required to show in your income tax return in India, if the interest amount goes above taxable limit.
I think it should not be a problem provided the transfer is not on repatriation basis . if it is on repatriation , then please ensure the chain of the transaction is tracked and tax thereon has been paid .
Further on account of some conference , the undersigned is presently is in Netherlands only . My no is +31202414730
CA, New Delhi Area, India
Interest on NRO deposit account is taxable. If your gross total income is greater than basic exemption then you are liable return of income in India.
The interest earned on NRE account is exempt but the interest earned on rupee savings accounts or NRO accounts is assessable to tax.
There is no tax on transfer to NRE Account. Also there is no tax on transfer to Wife local Bank Account. The income from the same is taxable.
Interest on NRO deposit account is taxable. If your gross total income from interest is greater than basic ,I e Rs 2,50,000 then she will have to pay income tax and file her return