FORMATION OF HUF
SUNIL KUMAR SRIVASTAVA
(Querist) 22 May 2010
This query is : Resolved
I AM A SALARIED EMPLOYEE. CAN I FOR AN HUF HAVING COPARCNER AS MY WIFE AND DAUGHTER AND REMIT SOME AMOUNT FROM MY SAVING TOWARDS INITIAL CORPUS OF HUF. THE HUF WILL INDULGE IN SALE/PURHCASE OF SECURITIES/SHARES AS BUSINESS. SINCE THE HUF HAS SEPARATE LEGAL STATUS CAN I, BEING, A GOVT. EMPLOYEE, MANAGE THE AFFAIRS OF HUF AS KARTA. WILL THE BE ANY LEGAL COMPLICATION AS ON MY EMPLOYMENT. IF I CANNOT CONTRIBUTE TOWARDS INITIAL CORPUS OF HUF THEN FROM WHERE THE HUF WOULD GET MONEY.
A V Vishal
(Expert) 22 May 2010
Formation of capital of HUF :Transfer money by gifts etc to HUF capital keeping in view the clubbing provisions and tax on gifts under Income tax act.
THE HUF HAS SEPARATE LEGAL STATUS CAN I, BEING, A GOVT. EMPLOYEE, MANAGE THE AFFAIRS OF HUF AS KARTA.
Ans. Yes you can be the karta and there is no bar on it.However, under certain government rules you need to disclose the fact of the existence of the the HUF to the department while submitting the Assets & liabilities statement annually.
G. ARAVINTHAN
(Expert) 23 May 2010
You are the Kartha of your family and you have power to do things for the welfare of your family
Vineet
(Expert) 23 May 2010
It would be better if you crate the initial corpus of your HUF by way of gift from any close relative say your parents or in laws to the benefit of your family.
Any income generated by HUF using funds transferred to the HUF by you shall be clubbed in your hands only and hence it will not serve the intended purpose. Better you give loan to HUF on refundable basis.
There will be no legal complication as you manage affairs of your HUF as Karta however, CCS conduct rules require you not to indulge in other business or employment and also intimate the government business activities of your family members including the HUF of which you are Karta.
soumitra basu
(Expert) 31 May 2010
I also agree with Mr. Vineet. Very good suggestion.
Harshada Shukl Kulkarni
(Expert) 22 May 2010
