Sir , I am using credit card of limit 8 lakhs but I don’t have income , spends through my parents money as I am still studying, can I pay my family shopping through my credit card ( my sister n brothers ) and they transfer to my account later ,will there be any IT problems?
Hi
No, there would not be any problem as such. Provided you maintain details of all such credits to your account and have explanations to prove the genuineness in case and query arises.
On a safer side, you should file NIL income tax returns for these periods.
Spending credit card in excess of Rs 2 lakhs will attract income tax eyes. It's not advisable to do so.
Bills of your credit card is treated as exp of your father/mother who pay the bills. there is no IT problem if they shown the same in proper way.they can either show this amount as exp or loan to you.
Hi,
Please let me know in whose name is the credit card?
Because if yearly payments in a credit card exceeds 2 lacs then credit card company will give the info to tax department and if tax department finds that person is not filing return of income or return filed by the person is not commensurate with the annual expenses, they will send notice.
Please feel free to call/ revert in case you need more clarity.
Thanks and regards
Abhishek Dugar
CA CS B.Com
Hello,
No problem in doing so. No IT problems as such.
In case your credit card bills exceed Rs. 2Lacs per year, make it a point to file your IT returns.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, FCA, LLB, CERT. FAFP
No there will not be any tax compliance as you use the money transfer by your parents also brother and sister comes into category of RELATIVE
so nothing to worry
Hi,
Yes, you can pay for their purchases and they can transfer the amount to you.
Regards,
Keerthiga Padmanabhan
M.Com., CA, LL.B
If your credit card is a dependent card, the responsibility for the payment of the credit card dues lies with your primary card holder only and such person should have adequate resources to make the payment. You need not worry about the sources of payment then. However, if your card is in your name as a primary card holder, the settlement of dues is your responsibility and you should be able to explain the sources for such payments. If the money for the payment of such dues is received from your parents or your own brothers and sisters, then they are in the nature of gifts to you and are exempt. You need not pay any tax on such receipts from them.
