Gold purchase in wife’s name: Will you have to pay tax on income from its sale in future?
Taxation of Gold purchased in wife’s name: Selling an asset at a price higher than the price at the time of purchase leads to capital gains tax. This applies to the sale of gold also. For example, if you buy gold in bulk today and sell it at a higher price in future, then you will be liable to pay tax on the capital gains made from such sale (Read more about how gold is taxed here).
Many individuals are interested in knowing about ways to save tax on capital gains from the sale of gold. One such reader recently asked FE Money about tax liability on the sale of gold purchased in his wife’s name.
“If a man gives money to his wife to buy gold jewellery, and the bill is generated in her name. In this case, who will pay tax on income from the sale of gold in future?” the reader asked.
Dr. Suresh Surana, Founder, RSM India, answers:
income arising on a property directly or indirectly transferred by an individual to his/her spouse will be clubbed with the income of such individual (i.e. transferor), provided that such transfer is not made against adequate consideration or as a part of a divorce settlement or under an agreement to live apart.
Therefore, in the given case where a man transfers money to his wife in order to purchase gold jewellery, the same will attract clubbing provisions and any capital gains accruing on the transfer of such jewellery will be clubbed with the income of the man.
Not just Gold, purchasing real estate property in the name of his wife doesn’t give a man any relief from the capital gains tax liability arising after the sale of such property or the tax liability on income earned by renting it. (Read full details here).
Investing in stocks and mutual funds through the wife’s bank account also doesn’t
Read more on financialexpress.com
