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CA Final · Direct Tax Laws & International Taxation · Income of Other Persons included in Assessee's Total Income

Aditi, a minor child, earned ₹90,000 as interest on a deposit made out of gifts from relatives. She also earned ₹50,000 from stage performances that depend on her own skill and talent. Her father's income is ₹12,00,000 and her mother's income is ₹9,00,000, both excluding her income. Ignoring any statutory exemption available per minor child, what amount is clubbed and in whose hands?

₹90,000 is clubbed with the father. A minor child's income is added to the hands of the parent with the higher income, and the father's ₹12,00,000 exceeds the mother's ₹9,00,000. The ₹50,000 earned through the child's own skill and talent is not clubbed.

  1. A₹1,40,000 with the father
  2. B₹90,000 with the fatherCorrect
  3. C₹90,000 with the mother
  4. D₹50,000 with the father

Explanation

A minor's income is clubbed with the parent whose total income, excluding the minor's income, is greater. That parent is the father (₹12,00,000 against ₹9,00,000). Income earned through the child's own skill, talent or specialised knowledge is not clubbed, so the ₹50,000 stays with Aditi. Only the ₹90,000 interest is clubbed with the father.

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