My wife and I have been NRIs continuously since 1991. I have been in continuous employment. My wife has not been employed but has earned income from tuitions for many years. She holds BSc and BEd qualifications. Both of us hold Either or Survivor NRE accounts in India. I have remitted funds periodically to these joint NRE accounts. Part of the remittances are my wife earnings. We jointly purchased 2 residential flats in India as equal owners, the first in 1993 and the second in 2012 and paid from our joint NRE accounts. One flat is used for our own use when we visit India. The other flat is rented out. Based on the above facts, will the transfer of funds from me to my wife be considered her own funds and not as a gift from me to her as the source of funds is from abroad remitted into a joint NRE account. Therefore will the income from residential house property, paid for from our joint NRE account, be outside the purview of clubbing section 64.
Dear Sir,
If the property is funded by both you and your wife and in joint name, you can divide rental incomes proportionately.
Clubbing provision will not apply in that case.
Please feel free to revert in case of any doubts
Thanks and Regards
Abhishek Dugar
CA CS B.Com
Thank you Mr. Abhishek for your response. Can you clarify if my entire remittance from abroad to our joint NRE account would not be considered as a gift to my wife. This is on the basis that 1. A gift of foreign currency made and received outside India is not considered as a gift under Indian Income tax and gift tax. 2. Remittance from abroad to our joint NRE account is construed as made and received outside India as both of us were resident abroad at the time of the remittance & acquisition of property in India and continue to be non resident.
Dear Sir,
In my opinion, whatever you have written is absolutely correct.
Please feel free to call/revert in case of any doubts
Thanks and Regards
Abhishek Dugar
CA CS B.Com
This query is specifically addressed to another expert.
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Query specifically asked to Mr. Abhishek.
Query is specifically directed to Mr. Abhishek.
