Hey @Deeban_Thangavelu,
Not able to completely understand your question. However, I’ll clarify how clubbing works.
If you gift shares to your wife, whenever your wife sells those shares, the capital gains will be clubbed with your income and you will have to pay taxes on the same. Even, any dividend received on these shares will be taxable in your hands.
However, whenever such income is reinvested, thee income then arising is not subject to clubbing and hence, your wife will be liable to pay taxes on it.
Mam, let me get cleared with 1 example pls… i have transfered shares worth 10lakhs to my wife she sells that shares for 10L and reinvests 10L again in same shares thereafter if any CG or dividend comes then its here liablity to pay tax am i right.since there is no capital gain from the shares gifted by me and sold by her is also for same value there wont any capital gain for me.pls confirm my statement is right r not
Hi @Surbhi_Pal
My question is in extension to what @Patty has asked.
I’ve gifted securities anticipating benefits from long-term capital gains (LTCG). Typically, the receiver of such assets incurs the tax liability. However, since I transferred to my spouse, any sale profits or losses would ultimately be added to my taxable income. I had not realized this while making the transfer.
Now, would it be sufficient if I included these sell trades from spouse account related to gifted security as if they’re my own in my ITR ? Or should I do something else here ?
For e.g. I Gifted 100 qty of Equity XYZ to my spouse. I have LTCG and it already crosses 1 Lakh limit. Now, the entire 100 Qty is sold in my spouse demat account with STCL. Per my understanding, I have added both LTCG entry and STCL entry in my ITR now.
Kindly clarify
Applicable Income Tax.
I have X company 100 shares bought at 100rs, current price of share 10000 per share so current value 10Lakhs.
My wife Housewife, No income -
If I gift shares to her today, and sell the shares from her account what will be her tax liability? any tax liability to me ?
I assume, upto 7 lakh income zero? 1 lakh capital gain benefit she can take it? + standard deduction and rest all she can avail - and pay negligible tax or say zero tax?
Hi @rakeshkumarg,
In case of shares being gifted to your spouse, clubbing of income is applicable. This means that whenever your wife sells the shares, the profits generated will be clubbed with your income and you’ll be liable to pay taxes on it. I’ll merge your Query to a relevant thread where I have written about this in detail (refer to the first post).
This is the case for incomes taxable at slab rates, for example salary, where you get a tax rebate upto ₹25,000 and hence there’s no tax liability under the new regime. But, profits from shares are taxed at special rates and the new regime does not allow a rebate on special rate incomes. Thus, you’ll get the basic exemption and ₹1.25L exemption on the LTCG but the income exceeding this limit will be taxable.
Okay thanks, I have basic query still.
I bought shares at 100
Transferred to my wife account today when share price is 10000
She sells the share at 9000
So will 8900 still be my clubbed income ?
Or I need 1000 loss would be clubbed loss?
Regards,
Rakesh.
Hi @rakeshkumarg,
When your wife sells the shares, the cost of acquisition will be considered as per the cost at which the original buyer, i.e. you had purchased the shares. So in your case, there would be a profit of 8900 and this will be clubbed with your income.
If in case the share was sold at say 90, then there would be a loss and the same would be clubbed as well. Hence, you would be able to claim those losses.
@Surbhi_Pal Mam I have doubt while filling ITR with clubbing details about TDS deposited by wife against clubbed income.TDS deducted in my wife PAN since she should get refund of TDS whether it should be shown in her ITR and get refund or we shall add the TDS details in my ITR manually and include clubbed income in my ITR and get refund pls explain…
Hey @Deeban_Thangavelu
If you are reporting the income in her ITR, you can include the TDS in her account and claim the refund. However, if you plan to club her income with yours in your ITR, you can manually add the deducted TDS under the TDS schedule in your return and claim the refund accordingly.
Hi @CA_Jayni_Bhavsar
If i gift shares to my mother, will clubiing of income happen or does entire Captial Gain fall in her bracket
i was going through this Quicko article and looks like I do not have to pay any tax on same. Please let me know on this
If above is true, does she has to report getting of these shares in her ITR ?
Hey @Vaibhav_Gupta
In the case of a gift of shares to the mother, the clubbing provisions would not be applicable. However, your mother needs to report this gift received in her ITR.
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I transferred some shares a decade ago to my wife (Then there was no gift deed) and she did sell some. Now, using provisions of Demat account, I gifted other shares to her a few months back. What will be the tax implications for her if all these shares are sold? (Asking this because I read that the transferor will have to bear the taxes)
Hi @FourSquare,
Yes, in this case, clubbing of shares will be applicable. This means the income will be clubbed in your hands and you’ll have to bear the tax liability on the capital gains.
Madam, My wife is a homemaker and doesn’t have any income. I’m making investments in her name separately, and I also do investments in my own name. Suppose we each have a long-term capital gain (LTCG) of ₹1.25 lakhs in a FY. Can we each claim an LTCG exemption of ₹1.25 lakhs, or do we need to combine our gains (totaling ₹2.5 lakhs) and only claim an exemption of ₹1.25 lakhs?