Fire your tax related queries and i would get it solved!!!

[TFL]

how much is your fathers income ???

NRI, as of now all funds are under NRE A/Cs so not paying any tax.

 

[hhh]

no tax is liable to be paid by you if your gross income is 1.5 lac only...

Thanks diosys for answering :thumb:
Curious to know since my loan tenure is 5 years, second part of my question, Can personal loan interest paid can be adjusted in coming years if my profit increases more than minimum tax exemption ?

 

[diosys]

NRI, as of now all funds are under NRE A/Cs so not paying any tax.

Ok....

so now i would suggest that you take this as a loan from him.... There are two main reasons why i say so..

1.) The interest that you pay to him each year would be tax exempt in his hand and accordingly you would be getting the deduction benefit for the same thus lowering your tax outgo...

2.) In case of taking as a loan it can anyways be converted into a gift if its felt so in the future but for gift that is not possible...so even after taking the amount as a loan you still have the other option open....

As for the amount to be trfd to wife what magnet has said is correct...there is no point in doing so since all the income would get clubbed in your hand...

Coming to Mr. Jhunjhunwala... Here what must have been the scenario is that she (wife) would be already having some capital to invest which she would have invested....Her invest able corpus would have been there and it was simply put to work...In your case you are gifting her the corpus itself which is not allowed....

So first generate some fictitious income in your wife's name for sources such as tuition income etc, then deposit cash in bank...and hence start the trading from there...Then it would not be a problem is you work as an employee under her.

JUST A SMALL POINTER - WHEN YOU TAKE THE AMOUNT FROM YOUR FATHER AS A LOAN OR REPAY HIM THE INTEREST OR PART LOAN BACK DO IT ONLY THROUGH AN ACCOUNT PAYEE CHEQUE....NO CASH !!!

 

[diosys]

Thanks diosys for answering :thumb:
Curious to know since my loan tenure is 5 years, second part of my question, Can personal loan interest paid can be adjusted in coming years if my profit increases more than minimum tax exemption ?

is this personal loan for trading activities ???

 

[hhh]

is this personal loan for trading activities ???

Yes. Complete 5 Lacs used for Nifty Futures and Options trading.
Thanks

 

[TFL]

Thank you for your detailed explanation.

Say, I gifted some amount to my wife and she also got income from her job and the both are credited to her single SB account. Then she takes back some part of money for expenses and the rest is used for trading. Will then the profit be clubbed with me? How can we differentiate the money gifted by me and earned by her. Can I state expenses from gifted money and trading capital from her earnings? This has already been done so no option to put them in seperate SB account. So, please answer in consideration of that.

 

[diosys]

Yes. Complete 5 Lacs used for Nifty Futures and Options trading.
Thanks

yup...you can avail the deduction....

 

[TFL]

Ok....

so now i would suggest that you take this as a loan from him.... There are two main reasons why i say so..

1.) The interest that you pay to him each year would be tax exempt in his hand and accordingly you would be getting the deduction benefit for the same thus lowering your tax outgo...

2.) In case of taking as a loan it can anyways be converted into a gift if its felt so in the future but for gift that is not possible...so even after taking the amount as a loan you still have the other option open....

As for the amount to be trfd to wife what magnet has said is correct...there is no point in doing so since all the income would get clubbed in your hand...

Coming to Mr. Jhunjhunwala... Here what must have been the scenario is that she (wife) would be already having some capital to invest which she would have invested....Her invest able corpus would have been there and it was simply put to work...In your case you are gifting her the corpus itself which is not allowed....

So first generate some fictitious income in your wife's name for sources such as tuition income etc, then deposit cash in bank...and hence start the trading from there...Then it would not be a problem is you work as an employee under her.

JUST A SMALL POINTER - WHEN YOU TAKE THE AMOUNT FROM YOUR FATHER AS A LOAN OR REPAY HIM THE INTEREST OR PART LOAN BACK DO IT ONLY THROUGH AN ACCOUNT PAYEE CHEQUE....NO CASH !!!

For getting the money as LOAN from my father is there any loan period limit?
Do I need to state upto what time the loan will be help and the interest rate?
For example if the amount is Rs: 25Lakhs what rate of interest you can suggest which seems genuine?

 

[TFL]

1.) The interest that you pay to him each year would be tax exempt in his hand and accordingly you would be getting the deduction benefit for the same thus lowering your tax outgo...

Also, If I'm taking the amount as gift then will the income(Business Income from it) from the gift money will need to club with my father? He's not filling returns as of now as his income from india is under tax limit.

 

[diosys]

Thank you for your detailed explanation.

Say, I gifted some amount to my wife and she also got income from her job and the both are credited to her single SB account. Then she takes back some part of money for expenses and the rest is used for trading. Will then the profit be clubbed with me? How can we differentiate the money gifted by me and earned by her. Can I state expenses from gifted money and trading capital from her earnings? This has already been done so no option to put them in seperate SB account. So, please answer in consideration of that.

practically such transaction would be very though for the ITO to catch...Hence if the deed has already been done then let it continue without tinkering it....

Or if you want then take the gifted money back vide an account payee cheque so that the earlier given money becomes a loan...Then give this amount as a gift to your mother in law (if you believe her ). She would gift this money to her daughter (your wife) and it becomes a clean slate for all.