TAX on fixed deposit yielding monthly interest

[Asked by Guest]

IF a parent deposits an amount in the name of his major child out of his pension in a cooperative bank where no kyc or pan card is attached to the account who will have to pay the tax? the deposit yields monthly interest? what will be the case if the deposit is made in joint name of parent and his son who is a major but unemployed?

[DR.MARIAPPAN GOVINDARAJAN]

Since the child is the major the interest from the deposit is his income. If the deposit is made in joint name of parent and his son, the parent may get income fully and liable for income tax. If it is proportioned, the due for the major child will be his own income.

[Ganeshan Kalyani]

It will be taxable under Income from Other source in the hands of the major child.

AI Summary

Taxation of interest income: interest on a fixed deposit in a major child's name is taxable to the child; joint-account attribution alters liability.
Interest on a fixed deposit in the name of a major child is the child's income taxable as Income from Other Sources. If the deposit is in joint names of parent and major child, tax liability follows the attribution of interest: the parent may be assessed for the full interest if treated as the parent's income, or each party is taxed on their apportioned share.