POST OFFICE RECURRING DEPOSIT

dasd (Querist) 22 December 2009 This query is : Resolved
IF I(GRANDMOTHER) HAVE DEPOSITED FOR MY GRANDSON MONTHLY RS 1000 FOR 5 YEARS IN POST OFFICE RECURRING DEPOSIT .NOW AT MATURITY I GOT CHEQUE IN HIS NAME SINCE HE BECOMES MAJOR NOW WHETHER "INT ON RD" ON MATURIY WILL BE TAXED IN HIS HANDS?
IF YES WHETHER I HAVE TO EXECUTE SOME DEED FOR THIS ?
WHETHER HE CAN UTILISE THIS MONEY FOR ANY PURPOSE OR BY UTILISING THIS AMT SOME OTHER HAVE EFFECT?

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A V Vishal (Expert) 22 December 2009
1.Interest on RD is taxable, subject to other sources of income where the net income exceeds the limit exempt from tax.
2. No deed to be executed.
3.He can utilize this money for any purpose.

Raj Kumar Makkad (Expert) 22 December 2009
Interest will be taxable in the hands of beneficiary. Your deposits are sufficient evidence for this purpose and no separate deed is required and after paying tax, he is free to utilise the same as per his wishes.

murtaza (Expert) 28 December 2009
Recurring Deposit is income that is including in your/GM income as income and its yearly calculation of interest. so after 5 years you don't have to worry because interest income is showing for the particular year.

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