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    HomeBusinessYour queries: Income Tax- Interest earned on joint accounts are taxable for...

    Your queries: Income Tax- Interest earned on joint accounts are taxable for both primary, secondary account holders

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    Deduct 5% TDS if monthly rent paid is above Rs 50,000.

    By Chirag Nangia

    I stay in my parent’s house. To avail benefit of HRA, I pay Rs 30,000 per month as rent to my father. Am I supposed to deduct TDS?

    —Vinay Tiwari

    As per Section 194-IB, with effect from June 1, 2017, an individual and HUF paying monthly rent above Rs 50,000 shall deduct TDS on rent at 5%. In your case, since monthly rent paid does not exceed Rs 50,000, you are not liable to deduct TDS.

    l My husband received Rs 14 lakh from his mother as a gift after she sold her house in 2018. We bought a flat but we forgot to mention it in the ITR of 2018. Now we want to do it as we got a notice under Section 131. How should we do it?

    —Vandana Rawat

    A notice under Section 131 is received when the Assessing Officer has reason to suspect that any income has been concealed or is likely to be concealed. From an income tax perspective, receipt of a gift from a relative does not trigger taxation, i.e., it is exempt in the hands of the receiver. However, it has to be disclosed as exempt income in Schedule EI of the ITR form. As you did not disclose the gift received, you got the notice. Gather all the documents sought and send within the deadline and co-operate with the tax authorities in the proceedings.

    l I have a Post Office Monthly Income Scheme (MIS) with my wife. The interest is credited in my savings account. How do I compute the tax on the interest?

    —Ashok Motwani

    Interest earned on joint accounts are taxable in the hands of both primary and secondary account holders. There is no TDS on the Post Office MIS, but the interest is taxable as per tax slab, to be reported in ‘Schedule OS’. Under Section 80TTA, you can claim deduction of interest earned on savings accounts held with the post office up to Rs 10,000. For senior citizens, this limit is Rs 50,000. These deductions may be claimed, while filing ITR. Furthermore, interest on Post Office Savings Bank Account is exempt up to Rs 3,500 for a single account holder and Rs 7,000 in a joint account under Section 10(15).

    The writer is director, Nangia Andersen India. Send your queries to [email protected]

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