It is provided in Section 64(1A) that while computing the total income of an individual there shall be included all such income which arises or accrues to his minor child. However, these provisions do not operate in the case of a minor suffering from any disability, like blindness, etc. as is specified in Section 80U. I have opened two accounts in name of my both children (both minor and have disability as defined under 80U) and transferred some of my salary income to their accounts. As the PAN no. associated with these accounts are mine, my 26AS is reflecting interest accrued in these accounts as my income. As i had submitted 15G, banks had not deducted TDS on interest incurred in these two accounts. My query is whether interest income in my children's account is my income or my children's income. If not, how to claim deduction in my IT return. I got SMS from IT department that my 26AS have income without corresponding deductions, after i filed my IT return without showing interest income of these two accounts. Pl guide.
Hi,
The case seems to be interesting. Prima facie, I believe that income should not be clubbed with your income and it should be your children's income.
I ll research on it more and get back to you.
Please feel free to call/ revert in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
Hello,
You can claim a deduction under section 80U while filing your return of income.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, ACA, LLB-GEN, CERT. FAFP
The Interest earn on the account in the name of your minor child is clubbed with your income.
while filling ITR you show this interest in the head of Income form other sources.
Dear Rohit, As per my understanding 80U is applicable in case of disability of Assesses not its dependent. In my case it is my dependent.
Section 80U and 80DDB provide tax benefits to individuals and their family members with disabilities. An individual suffering from disability himself gets tax benefit under section 80U while an individual gets tax benefits under section 80DDB if any dependent family member of the individual is suffering from a disability.
Hello,
If it is a dependent then you can claim u/s 80DD.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, ACA, LLB-GEN, CERT. FAFP
Dear Rohit, It is not about taking lump-sum rebate under 80DDB. It is about section 64(1A). Pl read my original question.
Dear Guys, I am really very disappointed. None of you have spared time to read my question carefully. It is already four days and no answer. I wasted my time and money. Anyway thanks.
Hi
My apologies for taking so long. You would appreciate that we are in midst of tax filing season.
My stands remains same. Technically, income should not be clubbed. However, since your 26AS is showing the income in your name, it will create mismatch and you will have face questions from income tax department to which you have to reply.
I would advice to file return of minor children and show amount given by you to your children as a gift in their return.
Please feel free to call/ revert in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
Hi,
You are right in not including the Interest Income in your IT Returns. From your question, I guess you have claimed the TDS on Interest in your IT Returns. Also, did you receive any Notice u/s 143(1)(a)?
