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Can single parent get I-T exemption on maintenance money: Law

Press Trust of India  |  New Delhi 

Whether single parents can get exemption on the money deposited in their account as maintenance for a minor child in a divorce settlement case?

The Commission is set to make recommendations in this regard in the coming days after the issue was referred to it by the and High

At present, as per the laws, the interest on money deposited as maintenance amount for a minor is clubbed with the of the guardian.

Referring the matter to the Commission, the and High had asked it to consider "as to whether the Act, 1961 requires amendment to create exception against clubbing of a minor's income accruing from maintenance money with either of the parent's income".

The has said that as per its opinion, the circumstances of the minor having received maintenance money are different from say a minor in whose name some business has been started by either of the parent or who has been advanced some gift during the subsistence of marriage of parents.

"The matter is, therefore, forwarded to the Commission and the Ministry of Women and Child Development for consideration whether suitable amendments are required to be made in the Income Tax Act, 1961, to ensure that maintenance settled on minors is exempted from income tax or is treated differently," the court said last January.

The Commission is set to finalise the report in the coming days. While a copy would be sent to the high court, it would also be handed over the Law Ministry.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, March 14 2017. 18:13 IST