A Hindu Undivided Family (HUF) is a legal and financial arrangement that is found only in India. The defining characteristic of an HUF is that it is taxed separately from its members. By allowing income to be spread across an additional entity (the HUF), and through its ability to claim deductions and exemptions under the Income-Tax (I-T) Act, a HUF can serve as a valuable tool for reducing a family's tax burden.
Kunal Savani, partner, Cyril Amarchand Mangaldas, says, "HUF, a uniquely Indian entity, is for large joint families and is governed by Hindu personal laws. As a distinct taxable entity, it needs to apply for its own permanent account number (PAN) and file its own tax returns, separately from its members." How HUF works Besides Hindu, Jain, Sikh, or Buddhist families may also form a HUF. HUF comprises members of a family with a common ancestor. Karta, the head of the family, manages the family assets and makes decisions on behalf of the HUF. "Both individual taxpayers and the HUF can claim deductions and benefits under the I-T Act," says Aditya Tiwari, associate, SKV Law Offices.
Bu hikaye Business Standard dergisinin February 21, 2024 sayısından alınmıştır.
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Bu hikaye Business Standard dergisinin February 21, 2024 sayısından alınmıştır.
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