Rent paid to HUF

suren (Querist) 12 May 2009 This query is : Resolved
Dear All,

Can u guide me to a query :-

HUF owns a Flat / House which is given on RENT to the Karta of the HUF.

What will be the treatment of RENT in the Hand of HUF as well Karta who pays the RENT ?

Presuming, Karta is in Service, can he claim RENT paid by him to his own HUF for calculating Salary Income.

What precautions / documantations will be required ?

Thanks & Regards

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A V Vishal (Expert) 12 May 2009
Dear Suren,

As per tax laws, the individual is different entity from his HUF. The rent received by the HUF is a income and assessable to tax subject to, the limits prescribed in the Income Tax Act, 1961. Similarly presuming that the karta of the HUF is in service he can claim it as an individual in view of the character as HUF and as an individual are different assessees for purpose of tax, further, the karta renders service in his individual capacity only.