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    Deductions To HUF

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    navinsurana1987
    A Hindu Undivided Family (HUF) can claim several tax benefits in India, including deductions under sections 80C, 80D, 80DD, 80DDB, and 80G of the tax code. Some key deductions the HUF can claim include deductions for life insurance premiums, contributions to the Public Provident Fund, home loans, and medical expenses. The HUF can also receive tax-free income from agricultural income, long-term capital gains on securities with securities transaction tax, and dividends. Interest paid on a housing loan for a self-occupied or rented property is also deductible. An effective tax planning strategy is for a salaried family member to receive rent from the HUF and deduct that

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    Deductions To HUF

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    navinsurana1987
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    A Hindu Undivided Family (HUF) can claim several tax benefits in India, including deductions under sections 80C, 80D, 80DD, 80DDB, and 80G of the tax code. Some key deductions the HUF can claim include deductions for life insurance premiums, contributions to the Public Provident Fund, home loans, and medical expenses. The HUF can also receive tax-free income from agricultural income, long-term capital gains on securities with securities transaction tax, and dividends. Interest paid on a housing loan for a self-occupied or rented property is also deductible. An effective tax planning strategy is for a salaried family member to receive rent from the HUF and deduct that

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    Deductions to HUF

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    A Hindu Undivided Family (HUF) can claim several tax benefits in India, including deductions under sections 80C, 80D, 80DD, 80DDB, and 80G of the tax code. Some key deductions the HUF can claim include deductions for life insurance premiums, contributions to the Public Provident Fund, home loans, and medical expenses. The HUF can also receive tax-free income from agricultural income, long-term capital gains on securities with securities transaction tax, and dividends. Interest paid on a housing loan for a self-occupied or rented property is also deductible. An effective tax planning strategy is for a salaried family member to receive rent from the HUF and deduct that

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    76 views2 pages

    Deductions To HUF

    Uploaded by

    navinsurana1987
    A Hindu Undivided Family (HUF) can claim several tax benefits in India, including deductions under sections 80C, 80D, 80DD, 80DDB, and 80G of the tax code. Some key deductions the HUF can claim include deductions for life insurance premiums, contributions to the Public Provident Fund, home loans, and medical expenses. The HUF can also receive tax-free income from agricultural income, long-term capital gains on securities with securities transaction tax, and dividends. Interest paid on a housing loan for a self-occupied or rented property is also deductible. An effective tax planning strategy is for a salaried family member to receive rent from the HUF and deduct that

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    Tax Benefits HUF can claim

    A list of tax benefits a HUF can claim are:

    Tax Deductions under Chapter VI-A::

    1) Deduction u/s 80C:: A HUF can claim tax deduction by

    (a) Taking out Life Insurance Policies/ ULIPs in the name of its members and make payment of the premium

    (b) Contributing to the PPF account of its members

    (c) Investing in Five Year Bank Fixed Deposits, Equity Linked Savings Scheme

    (d) Invest in notified bonds of NABARD

    (e) Purchase a house property on bank loan and claim principal amount of loan paid

    The maximum amount for deduction u/s 80C cannot exceed Rs. 1,50,000 from F.Y. 2014-15.

    2) Deduction u/s 80D:: Medical Insurance premium paid by HUF for the benefit of any member of the family is deductible from gross total
    Income. The limit for deduction is Rs. 15,000 (Rs. 25,000 from F.Y. 2015-16) for any member and Rs. 20,000 (Rs. 30,000 from F.Y. 2015-16) for
    senior citizen member.

    3) Deduction u/s 80DD:: W.r.t. Medical treatment of a handicapped dependent who is a person with disability – If the HUF pays for medical
    treatment for rehabilitation of such a member of the family, tax deduction is available upto Rs. 50,000 (Rs. 1,00,000 in case of severe disability).
    However to claim this, the member should be wholly dependent upon HUF for support and he should also not have claimed the same disability
    deduction u/s 80U in his return.
    4) Deduction u/s 80DDB:: If the HUF pays for medical treatment for any member of the family who is wholly/ mainly dependent on the HUF for
    support, tax deduction is available upto Rs. 40,000 (Rs. 60,000 in case of senior citizen) or actual expenditure, whichever is lower.

    5) Deduction u/s 80G:: Any donations to certain funds, charitable institutions, NGOs made by HUF can be claimed u/s 80G.

    6) Deduction u/s 80GGC:: Any contribution made to political party or electoral trust by HUF is deductible. If the contribution is made in cash, it is
    not allowed as deduction.

    Tax-Free Incomes::

    Agricultural Income, Long Term Capital Gains on securities on which STT is paid and Dividend Incomes remain tax-free even in the hands of
    HUF.

    If HUF is a partner in a partnership firm, the share of profit of HUF from partnership will be exempted from tax.

    Also, any payments received by a member of HUF from HUF’s income is exempted from tax.

    Interest on housing loan::

    If a house is purchased on loan, the HUF can claim deduction w.r.t. interest on loan upto Rs. 2,00,000 in case of self-occupied house. When the
    house is put on rent, the whole amount of interest paid is deductible from Rental Income.

    An effective way to structure your taxes would be when you are a salaried employee and your HUF is the owner of the house property in which
    you are staying. Then you can make payment of rent to HUF, obtain rent receipt from HUF and submit the same along with PAN card of HUF to
    the employer and claim a tax deduction on the HRA amount from the employer. And the HUF can also claim the whole housing loan interest from
    the rental income. In this way, you can effectively reduce your tax outgo of the family.

    ** Note: This publication is for private circulation only.

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