Asked by: Vojtech Liverovsky
religion and spirituality hinduism

How does Hindu undivided family work?

Last Updated: 29th January, 2020

17
An HUF is a family which consists of allpersons lineally descended from a common ancestor, and also thewives and daughters of the male descendants. Once a daughter getsmarried, she becomes a member of her husband's HUF, whilecontinuing to be a coparcener of her father'sHUF.

Click to see full answer.

Also know, what does Hindu undivided family means?

The term 'Hindu Undivided Family' has not beendefined under the Income Tax Act. It is defined underthe Hindu Law as a family that consists of allpersons lineally descended from a common ancestor, including wivesand unmarried daughters. A HUF cannot be formed by a groupof people who do not constitute afamily.

Also Know, what is the benefit of HUF? The major advantage of creating a HinduUndivided Family Account is that the family gets an extra PANCard and can split the family income and thereby resulting in taxsaving and reducing the tax outgo. This is the major reason whyCA's advise their clients to create a HUF and save taxes ofupto Rs.

In respect to this, can we pay commission to HUF?

The insurance under HUF would belong to andbecome the assets of the HUF. However, PPF account in thename of HUF is no more permitted as clarified by theministry of finance in 2005. To claim deduction under section 80C,an HUF can contribute to the PPF account of its members andclaim a tax deduction.

Who comes under Hindu undivided family?

An HUF is a family which consistsof all persons lineally descended from a common ancestor,and also the wives and daughters of the male descendants. Itconsists of the karta, who is typically the eldest person orhead of the family, while other family membersare coparceners.

Related Question Answers

Anneke Pereu

Professional

Can husband and wife form HUF?

A husband and wife can form an HUF but awife can only be a member, not a co-parcener. Therefore, theHUF income will not be assessed separately. A memberhas equal rights but only a co-parcener can demand thepartition of the HUF. "The HUF is not an individual,so it has no relatives.

Millerlandy Sandadiano

Professional

How HUF can save tax?

An HUF is allowed to make investments intax-saving Fixed Deposits and Equity Linked SavingsScheme (ELSS) to earn tax benefits of up to Rs1.5 lakh under Section 80C.

Zahari Ocete

Professional

What is the full form of HUF?

Hindu Undivided Family

Imara Allal

Explainer

Who is a Coparcener?

An Explainer: Coparcener
Coparcenary is a term often used in matters related tothe Hindu succession law, and coparcener is a term used fora person assumes a legal right in his ancestral property by birth.To understand this better, we have to first understand the termHindu Undivided Family (HUF).

Morro Kendrick

Explainer

What is HUF Law?

In matters related to property laws, the termHindu Undivided Family (HUF) if often used. An HUFcomprises all the people who have lineally descended from a commonancestor and includes wives and unmarried daughters.

Rodayna Karl

Explainer

Who can give gift to HUF?

Gift received by HUF from its members areexempt under Section 56(2)(x). Definition of “relative”in case of a Hindu Undivided Family covers any member thereof. Itdoes not include relatives of such member. Thus, giftreceived by HUF from relatives of members shall betaxable.

Roya Velgus

Pundit

Can wife be a Coparcener in HUF?

Your wife is a member of the HUF but not acoparcener. She would be entitled to a share in theHUF property only upon partition. Though, a wifecannot demand a partition of the HUF property, if there is apartition, she will get a share equal to that of her husbandand her children who are part of the HUFfamily.

Thorsten Negrel

Pundit

Which income can be shown in HUF?

HUF is treated as a 'person' under section 2(31)of the Income-tax Act and is a separate entity for thepurpose of assessment.

Quilen Albini

Pundit

Can Karta withdraw money from HUF?

Consent as such will not be required. Thekarta can withdraw the amount. But if by this withdrawalkarta converts HUF property into his personal property,the co parceners can apply for partition ofHUF.

Haron Astorga

Pundit

Can a salaried person open HUF account?

As soon as Hindu individual is married he canopen an account in the name of his HUF and whenthe child is born, he will automatically become member ofhis fathers HUF. Under income tax, HUF is treated asa separate person. Can a salaried individual dividehis income? The answer is no.

Badea Chamov

Pundit

Can a father gift money to his son's HUF?

Yes, this amount will be taxable in the hands ofyour son's HUF. No, income from such gift will not beclubbed in your HUF. Also, gift from parentsto Son is exempt. First gift the amount from yourHUF to you or your wife.

Benardino Cubillana

Teacher

Can HUF invest in PPF?

To avail 80C deduction the HUF can open alsocontribute to PPF account. But now a days the banksdo not permit the opening of separate PPF account inthe name of the HUF. But the HUF can contribute tothe PPF account of its members and claim taxdeduction.

Fredesvinda Gotter

Teacher

What is HUF PAN card?

A PAN Card is a very important document for HinduUndivided Families (?UFs), second only to the HUF Deed. Itestablishes the HUF as a financial entity that can open bankaccounts, buy property and make investments, among otherthings.

Mher Fiefhaus

Teacher

How can Huf be dissolved?

Dissolution of HUF occurs when partitionof HUF's property is done.Partition of HUF can bedone at any time i.e. either on Survival of Karta or on death ofKarta. Partial Partition of HUF is not allowed as per IncomeTax Act 1961. Hence in your case, HUF ceased to exist assoon as your brother partitioned the property.

Estanisla Burckhardt

Teacher

What is HUF in income tax?

Hindu Undivided Family ('HUF') is treated as a'person' under section 2(31)? of the Income-tax Act,1961 (herein after referred to as 'the Act'). HUF is aseparate entity for the purpose of assessment under the Act. AnHUF cannot be created under a contract, it is createdautomatically in a Hindu Family.

Kora Tegeler

Reviewer

Can Karta give interest free loan to HUF?

Distribute income to co-parceners: The karta cangift money to the coparceners from the income earned by theHUF. This income is tax-free in the hands of theco-parceners. The HUF can charge interest on theloan. Interest paid on any business loan isfully deductible.

Betina Velazco

Reviewer

Can HUF pay LIC premium?

The taxpayer (being individual/HUF) canclaim deduction under section 80D in respect of medical insurancepremium paid by him in any mode other than cash. However,payment on account of preventive health check-up canbe made in cash.

Yanyu Lindheimer

Reviewer

What are the main characteristics of HUF?

Characteristics of a Joint Hindu Family Business:
  • The main characteristics of Joint Hindu Family Business aregiven below:
  • Governed by Hindu Law:
  • Management:
  • Membership by Birth:
  • Liability:
  • Permanent Existence:
  • Implied Authority of Karta:
  • Minor also a Partner:

Mose Turko

Reviewer

Can a woman be Karta of HUF?

The high court ruled that the eldest woman memberof a family can be its karta. He or she caneven gift away the movable properties of the family. “TheHindu Succession Amendment Act, 2005 gave women equal rightsof inheritance, making them coparceners. The karta usuallyis the eldest coparcener.