A. Income from Mrs.Q's profession, Rs. 45,000
B. Mrs. Q's salary as a clerk, Rs. 66,000
C. Minor son's earned interest on deposits of money gifted to him by his uncle, Rs. 15,000
D. Minor daughter's earnings from sports, Rs 85,000
E. Minor son's winnings from lottery, Rs 1,05,000
Choose the correct answer from the options given below:
Clubbing Minor's Income: MCQ Explanation
This solution explains the clubbing of income provisions under the Indian Income Tax Act, 1961, to determine which of the given incomes should be included in Mr. Q's total income.
Analysis of Income Items for Clubbing
We need to assess each income item based on the clubbing provisions, particularly Section 64(1A), which deals with the income of minor children.
- Options A & B: Income of Mrs. Q
- Income from Mrs. Q's profession (`Rs. 45,000`) and her salary as a clerk (`Rs. 66,000`) are generally considered her own income. These incomes are not clubbed with Mr. Q's income unless specific conditions demonstrating contribution to Mr. Q's business or profession are met, which are not indicated in the question.
- Options C, D, & E: Income of Minor Children
- Option C: Minor son's interest income (`Rs. 15,000`): Interest earned on deposits is income arising from assets. As it is not income earned by the minor through personal exertion, Section 64(1A) mandates that this income is clubbed with the income of the parent having the higher total income (before clubbing). Assuming Mr. Q has the higher income, this is clubbed.
- Option D: Minor daughter's earnings from sports (`Rs. 85,000`): Earnings derived from the minor's own personal exertion, talent, or skill (like sports) are taxable in the hands of the minor child themselves. This income is not clubbed with the parent's income.
- Option E: Minor son's lottery winnings (`Rs. 1,05,000`): Lottery winnings are considered casual income. Similar to interest income, this is not income earned through personal exertion. Therefore, it falls under the clubbing provisions of Section 64(1A) and is clubbed with the parent's income.
Conclusion on Clubbable Incomes
Based on the analysis:
- Option C (Minor son's interest income) is clubbed.
- Option E (Minor son's lottery winnings) is clubbed.
- Option D (Minor daughter's sports earnings) is not clubbed as it's from personal exertion.
- Options A and B (Mrs. Q's income) are not clubbed based on the information provided.
Therefore, the incomes to be clubbed into Mr. Q's income are from options C and E.
Important Questions from Income-tax
Tax audit is compulsory in the case of a person carrying on profession and whose gross receipts exceeds which one of the following?
Which are the appropriate tax planning perspectives in case of shutdown or continued decision under the Income Tax Act, of 1961?
A. Business loss and unabsorbed depreciation can be carried forward and set off against profit and gain.
B. The loss-making company and profit-making company may merge to avail of the tax benefit
C. Tax benefit of deduction u/s 33 AB and 115 VT may be withdrawn and liable to tax for the year in which the business is discontinued.
D. The condition of section 80 IB / 80 IC of the Act, a deduction is allowed for such undertaking
E. If a person has more than one business, the loss-making business may not be discontinued.
Choose the most appropriate answer from the options given below:
Belated return u / s 139(4) can be filled at any time
Which of the following is NOT a change of the new Income Tax bill introduced in the Parliament during February 2025?
What is the basic difference in the aggregates at market price and factor cost?
