Accountability of inetrest earned on FD

[KASTURI SETHI]

Dear all experts,

If I gift one FD of more than Rs.one lakh to my wife, whether interest earned on that FD will be accounted for towards my income or my wife's income for payment of Income Tax ? Pl. guide. Thanks.

AI Summary

Interest from Gifted FD to Spouse Taxable Under Giver's Income Per Section 64 of Income Tax Act; No Senior Citizen Exemption An individual inquired about the tax implications of gifting a fixed deposit (FD) exceeding one lakh rupees to their spouse, questioning whether the interest earned would be taxable under their income or their spouse's. An expert initially suggested it would be taxable under the spouse's name. However, upon further review, it was clarified that under section 64 of the Income Tax Act, the interest income should be included in the individual's income for tax purposes. Consequently, the spouse cannot claim the senior citizen exemption on this interest income.