Virendrakumar (Additional General Manager) 06 November 2011

I t exemption

What is Tax Status for compensation to a divorcee?

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6 Replies

adv. rajeev ( rajoo ) (practicing advocate) 07 November 2011

it is compensation not an income

Sanjeev (Lawyer) 07 November 2011

There is no deduction available for the husband who pays the compensation to his wife for divorce neither the wife has to pay tax on such compensation but the income that she will earn by way of interest if she places the Compensation in bank will be chargeable subsequently.

So initial compensation is not taxable.

(Guest)

In short part of your taxable income will reach your wife as a Tax free compensation. In other words marriage is your tax liability and tax free cash for her[Your hard earned cash].