I have received a sum of Rs 8 lakh from my brother, upon surrendering my share of inherited property to him after my mother?s demise. I would like to know if the same is taxable.
?Sunita
The transaction can be treated as a family arrangement related with inherited property. It can also be viewed as a gift from your brother to you. In either case, there is no income tax involved. However, if the property has been sold, the tax on capital gains will have to be paid by your brother.
I am a retired government employee. My daughter is receiving treatment from PGI, Chandigarh. She is undergoing dialysis in a private hospital twice a week as per the written advice of PGI, Chandigarh to do so from any Centre of Convenience outside PGI. My department is treating the expenditure so incurred by me as my income and deducting income tax from the reimbursement claim, which does not appear to be justified.
Please advise.
?S Singh
It appears that you do not fall under the conditions stipulated by Sec 17 for grant of exemption.
Firstly, you are not an employee and secondly, you have, albeit with the approval of PGI got your daughter treated in a private hospital.
Sec 17 requires the treatment to be taken from i) Any hospital maintained by the employer ii) Any hospital maintained by the government or any local authority or any other hospital approved by the government for the purposes of medical treatment of its employees; iii) Any hospital approved by the chief commissioner.
The person responsible for applying TDS is not authorised to grant you the exemption from the perquisite. You may claim this deduction while filing returns.
We wish to point out that Sec 80DDB states, that a resident assessee shall be allowed a deduction of Rs 40,000 if he has, during the previous year, actually incurred expenditure for the medical treatment of such disease or ailment as may be specified in the rules for himself or a dependent relative.
What happens if a PPF A/c holder or subscriber dies under the following condition:-
i) If fifteen years of the investment period is not completed
ii) If the extension period of five years (15 years are over) is not completed.
Can the legal heir close the a/c or do they have to continue it for the duration to be over?
?Vrinda
On the death of a subscriber, the balance in the PPF account is paid on demand to his nominee or successor. However, the balance, if not withdrawn, continues to earn tax-free interest. No partial withdrawals are permitted. It is risky for the nominee to continue the account because the nominee cannot appoint a nominee.
In the case of joint nominees, PPF rules allow allocating a percentage of benefits against each nominee. But the form does not provide a specific place to indicate the same and therefore, many fail to indicate the percentages.
In that case, the nominees are treated as joint holders and have to apply together for the closure. Each nominee is required to identify himself to the satisfaction of the concerned officer. After completing all the formalities, a single cheque is issued in favour of all of them together. This cannot be encashed, unless all the nominees have a joint account. If no nomination is in force, the balance will be paid to the legal heirs on production of the succession certificate or probate. In India, it takes an enormous time, money, and energy to obtain this. To mitigate hardships, a balance up to Rs 1 lakh may be paid to legal heirs on applying in Form-G along with i) a letter of indemnity, ii) an affidavit, iii) a letter of disclaimer on affidavit and iv) a death certificate.
I propose to remit $20,000 to my mother in India through my NRE account in India by way of a gift. She proposes to invest in term deposits in an Indian bank in her name. She has no other income in her name and hence the interest she earns from the TDR will be below the taxable limit. Can she, after one year, remit the entire amount to me for my maintenance expenses? I understand a sum of $ 200,000 a year can be remitted that way.
?Sumi
There would be no tax incidence on either you or your mother upon gifting to each other any sums of money. You are correct in observing that she can remit the entire amount back to you for maintenance expenses.
The limit for maintenance expenses, however, is $100,000 and not $200,000. The $200,000 limit is for investments abroad including gifts and donations. So technically she can remit to you $300,000 pa, which includes $100,000 as maintenance expenses and $200,000 as a gift.
?The authors may be contacted at wonderlandconsultants@yahoo.com