What are the main characteristics of HUF?
Characteristics of a Joint Hindu Family Business:
- Governed by Hindu Law: The business of the Joint Hindu Familyis controlled and managed under the Hindu law.
- Membership by Birth:
- Permanent Existence:
- Implied Authority of Karta:
- Minor also a Partner:
Hereof, what are benefits of HUF?
The major advantage of creating a Hindu UndividedFamily Account is that the family gets an extra PAN Card andcan split the family income and thereby resulting in tax saving andreducing the tax outgo. This is the major reason why CA’s advisetheir clients to create a HUF and save taxes of uptoRs.
Also, what is difference between individual and HUF? All the members of the Karta’s family can be members ofthe HUF. The male members are called coparceners, while thefemales are referred to as just members. The differencebetween the two is that any of the coparceners can demandpartition of the HUF.
Additionally, what is HUF account who can open it?
As soon as Hindu individual is married he canopen an account in the name of his HUF and whenthe child is born, he will automatically become member ofhis fathers HUF. Under income tax, HUF is treated asa separate person. So you can divide your income in twoparts.
What is the meaning of HUF?
Hindu Undivided Family (HUF) Concept ofHUF. The term ‘Hindu Undivided Family’ has not been definedunder the Income Tax Act. It is defined under the Hindu Law as afamily that consists of all persons lineally descended from acommon ancestor, including wives and unmarrieddaughters.
Related Question Answers
Can a salaried person open HUF account?
Claim benefits under HUF account While you will have to pay tax on yoursalary as per the marginal tax rate, the additional incomecan be taken in the name of a separate HUF account. AHindu Undivided Family (HUF) status is available toHindu, Sikh and Jain families in India.
Is wife a Coparcener in HUF?
Your wife is a member of the HUF but not acoparcener. She would be entitled to a share in theHUF property only upon partition.
What are the benefits of HUF account?
The creation of Hindu Undivided Family helps thetax payers to save their taxes in a legal manner. It is a wellknown fact that every individual member of the family specially theadult members of the family would enjoy a tax deduction up to Rs.1,00,000 in terms of section 80C of the Income-tax Act,1961.
How is HUF property divided?
In total partition, all the member of the HUFceases to be members of the HUF and the wholeproperty ceases to be the HUF property. Partialpartition can be property specific too where theproperty is divided between members and the rest ofthe property continues to HUF property.
What happens when Karta of HUF dies?
A daughter after her marriage has no right at all inassets of HUF. After the death of karta, ifthere is no male member, the wife of karta not becomes akarta. If a Karta dies, leaving behind his window andminor son, even then, wife is not permitted to become akarta.
What should be the name of HUF?
The name of the HUF is usually thename of the Karta followed by the word HUF. For eg:If the Karta of the HUF is Suresh Kumar, the name ofhis HUF would be Suresh Kumar HUF. It also states thecapital with which the HUF has been initiated. There arevarious sources through which Capital can be introduced inthe HUF.
Can wife become Karta of HUF after death of husband?
On the demise of a male karta, it is nowpossible for a daughter to become a karta of theHUF under the circumstance where she is the eldest adultcoparcener in the family. A widow therefore, cannot act askarta of the HUF after the death of herhusband.
Can a person be Karta in two HUF?
It is possible a person can be Karta in twoHUF. 13 June 2013 Yes you can have two HUFs. Yourmother cannot be karta, she can only be the managerof HUF if there are no male members or if the male membersare minors. So you can have 2 HUFs.
Is HUF a separate legal entity?
Naturally, HUF is treated as a distinctentity for tax purposes. HUF need to have aseparate PAN card and need to file separate ITreturns. One of the major benefits of the Hindu Undivided Family isthat it is considered a separate legal entity.
Can daughter in law be a Coparcener in HUF?
Yes, a married daughter is considered a part ofHUF. Prior to 2005 amendment in the Hindu Succession Act,1956, the daughter, on her marriage, ceases to be a memberof her father’s HUF and becomes a member of her husband’sHUF. Thus in event of partition of her Husband’s HUF,she has one share in such property.
Can Karta sell HUF property without consent?
In this case, taken up by Two-Judge Bench of the SupremeCourt, the Court has ruled that Karta of the Family cansell share in ancestral property on account of legalnecessity even without obtaining due consent of othercoparceners.
Can HUF pay LIC premium?
The taxpayer (being individual/HUF) canclaim deduction under section 80D in respect of medical insurancepremium paid by him in any mode other than cash. However,payment on account of preventive health check-up canbe made in cash.