Understanding the Provisions of Clubbing of Income

Understanding the Provisions of Clubbing of Income

This 2024 edition of Understanding the Provisions of Clubbing of Income under the Income Tax Law by Ram Dutt Sharma offers a comprehensive and practical analysis of the statutory rules governing the clubbing of income under the Income-tax Act, 1961. Updated in accordance with The Finance Act, 2024, the book serves as a detailed reference for tax practitioners, chartered accountants, students, and legal professionals.

Clubbing of income provisions are intended to prevent tax evasion by including in a taxpayer’s income certain incomes legally belonging to another person. This book provides a clear explanation of the relevant sections, supported by illustrations, case law, and departmental interpretations.

The content covers:

• Concept and rationale behind the clubbing provisions

• Statutory framework under Sections 60 to 64 of the Income-tax Act

• Transfer of income without transfer of assets

• Revocable transfers and their tax implications

• Clubbing of income of spouse, minor child, and son’s wife

• Treatment of income from assets transferred to a person for inadequate consideration

• Clubbing provisions applicable to partnership and HUF scenarios

• Special provisions for clubbing in the case of minors’ income and exemptions under section 10(32)

• Judicial precedents clarifying the scope and interpretation of clubbing provisions

• Compliance requirements and practical precautions to avoid adverse consequences

• Tax planning tips within the legal framework to mitigate clubbing effects

This edition is especially useful for:

• Chartered accountants, tax consultants, and corporate finance teams

• Law students and academicians specializing in taxation

• Income-tax officials and legal practitioners handling tax litigation

• Individuals and HUFs seeking clarity on ownership and income attribution rules

With its blend of statutory guidance, practical illustrations, and updated case law, Understanding the Provisions of Clubbing of Income equips readers to interpret and apply these provisions accurately, ensuring both compliance and effective tax planning.