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As per Section 60

If a person only transfers his income to some other person but doesn’t transfer the asset, Income will always be clubbed in the hands of transferor i.e. Person owning the asset.

It doesn’t matter whether transfer is revocable or not

 

Example

Mr. A gave a house on Rent to Mr B. He asked B to given rent of it to Mr A’s son

In this case, there is transfer of Income (Rent) but there is no transfer of Asset (House)

Hence, income will be taxable in the hands of Mr A even though it has been received by Mr A’s son

 

Transfer of Income when there Is No Transfer Of Assets - Different types of Clubbing

  1. Income Tax
  2. Clubbing of Income of Other Persons
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About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 8 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .
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