In this case the rulings were pronounced on 27.8.2012 holding that the settlement amount will be regarded as sum chargeable to tax as required under section 195 of the Act and the deduction of the tax will be made by the payer when the amount is moved from the segregated account in India to the initial Escrow Account in the US.
Full Answer
Is dowry still paid in India?
Historically, dowry was paid in Europe, South Asia, and Africa. In the present day, dowry is paid in over eighty percent of marriages in Bangladesh, India, and Pakistan. These days, the word ‘gift’ is sometimes used as an euphemism instead of ‘dowry’.
Is dowry looked down upon in Uttarakhand?
I belong to Uttarakhand. If you belong to a pandit family, dowry is looked down upon and people are very upfront about not receiving or giving any dowry. But people do give gifts to the family of groom and a little gold to the girl in their own capacities.
What is a dowry in a wedding?
Dowry is the money, goods, or the estate that the bride’s family gives to the groom’s family at the time of the wedding. This practice is common in cultures that are strongly patrilineal, patrilocal and have male-biased inheritance laws. Historically, dowry was paid in Europe, South Asia, and Africa.
Is dowry a gift in Bangladesh?
In the present day, dowry is paid in over eighty percent of marriages in Bangladesh, India, and Pakistan. These days, the word ‘gift’ is sometimes used as an euphemism instead of ‘dowry’. Families that like to pose as progressive might use the word ‘gift’ to disassociate themselves from the act of giving or receiving dowry.
Is dowry taxable?
The gifts received by the newly wed couple from the immediate family or relatives are not taxable in India. The gifts can be in the form of house, property, cash, jewellery or stock or more are exempt from taxation.
Is money received in a divorce settlement taxable?
Generally, lump-sum divorce settlements are not taxable for the recipient. If the lump-sum payment is an alimony payment, it is not deductible for the person who makes the payment and is not considered income for the recipient.
Does divorce save tax?
In case of divorce, the courts, generally, grant lump sum alimony as well as periodical payments in case alimony is demanded. There are no specific provisions in the Indian tax laws dealing with tax treatment of such receipts.
Where do I show alimony in ITR?
If you are required to file ITR, you must show the amount of receipt as Exempt income. Hello, Yes, you need to show alimony in ITR under the exempt income head.
Is settlement money considered income?
Settlement money and damages collected from a lawsuit are considered income, which means the IRS will generally tax that money. However, personal injury settlements are an exception (most notably: car accident settlements and slip and fall settlements are nontaxable).
Is a cash settlement taxable?
Settlements for automobile and property damages are not taxable, but there are exceptions. Like medical expenses, the IRS and the State of California consider these damages as reimbursement for a car or home previously paid.
Who benefits the most from a divorce?
Divorce makes men - and particularly fathers - significantly richer. When a father separates from the mother of his children, according to new research, his available income increases by around one third. Women, in contrast, suffer severe financial penalties.
How much do you pay your wife after a divorce?
When alimony is paid periodically. The Supreme Court in one of its landmark judgments has set a benchmark for maintenance to be paid by a husband to his estranged wife. It stated that 25% of the net salary of the husband might constitute a “just and proper” amount as alimony.
Is it better to file married or divorced?
An indemnification agreement says that one spouse will be liable for any amounts due on previously filed joint returns and protects the spouse who didn't prepare the return. However, if you have doubts about your spouse's ability to prepare accurate tax returns, you're better off filing separately.
Will alimony be tax-deductible in 2021?
Alimony taxation The taxation of alimony on federal tax returns recently changed because of the Tax Cuts and Jobs Act of 2017 (TCJA). Today, alimony or separate maintenance payments relating to any divorce or separation agreements dated January 1, 2019 or later are not tax-deductible by the person paying the alimony.
Can alimony be a tax deduction?
Alimony or separation payments are deductible if the taxpayer is the payer spouse. Receiving spouses must include the alimony or separation payments in their income.
Can I claim tax relief on alimony payments?
It is possible to claim tax relief on maintenance payments you make to a former spouse or civil partner. The tax relief will reduce the income tax that you pay, so if you don't pay tax the relief will have no benefit.
Is a lump sum spousal support payment taxable?
Lump sum payments are generally not taxable, unless they are made to bring overdue periodic payments up to date or are specifically ordered as retroactive payments. Therefore, lump sum payments may also be useful for the recipient's tax purposes.
How do I avoid Capital Gains Tax in a divorce?
Primary Residence If you sell your residence as part of the divorce, you may still be able to avoid taxes on the first $500,000 of gain, as long as you meet a two-year ownership-and-use test. To claim this full exclusion, you should make sure to close on the sale before you finalize the divorce.
Who pays capital gains in divorce?
Property Settlements When this occurs and the property has increased in value since the time of the divorce, the seller may owe capital gains taxes based on the value of the property at the time of acquisition.
Are legal settlements tax deductible?
Generally, if a claim arises from acts performed by a taxpayer in the ordinary course of its business operations, settlement payments and payments made pursuant to court judgments related to the claim are deductible under section 162.
Settlement in 498a
I am considering settlement with wife for full and final settlement in 498a case (pending in court) along with DV and Divorce cases. Please advise on what I need to caution for and what clauses / conditions I should insist on along with the final amount and instalments to be given?
What is the procedure for arrest under Section 498A and 406 in Delhi?
In Delhi, the police follows the below procedure in normal circumstances for arrest under 498a/ 406 Cases:
How does a man prove he did not demand a dowry in a dowry case?
Though it is right that it is for the prosecution to prove that there was demand for dowry but in Indian courts as per current practice it is difficult to get bail or anticipatory bail without some kind of proof.
What to do when IO calls in 498a cases
You receive a call from the police station and on the other line there is an Investigating officer is on the other side of the line.For one moment panic strikes you and you come to know that your wife has lodged a false 498a case against you and your family.
1 Replies
The guiding factor to determine the taxability would be the decree of thecourt showing the breakup of the amount of Rs. 425000/- The interest and liquidated damages if any alone are taxable. Assuming the entire surplus is interest and/or liquidated damages then the taxability woudl be as under:
Leave a reply
Your are not logged in . Please login to post replies Click here to Login / Register
Did Jaimala give a gold ring to his groom?
As per a ritual in groom's family, a gold ring should be given to groom at the time of Jaimala. But in my family, there is no such ritual, so we were not prepared for this. At the time of Jaimala, They demanded gold ring, but my grandpa refused because we didn't have.
Is reverse dowry a crime?
Both are equally wrong. But the irony is that only dowry is treated as a crime, but reverse dowry is attributed to "practicality"...!
What are the class I heirs of a Hindu male?
For example, in case of a Hindu male who passes away intestate, the class I heirs include mother, wife, children, son of predeceased son and so on. However, father is not the immediate legal heir of a Hindu male. Thus, if there are no class I heirs of a Hindu male, only then the father will be eligible to receive the assets of his son. Hindu succession law also states that every legal heir of the same class (e.g say all Class I heirs) has equal right on every asset of the deceased if there is no Will. The bank will, normally, pay the money to the nominee and he/she will be required to transfer it to the legal heirs as per their entitlement.
Is EPF withdrawal tax exempt?
If the money is withdrawn from the EPF account at the time of maturity or partial withdrawal is made as allowed under the EPF scheme (such as for the purpose of marriage, building a house etc.), then the withdrawal is exempted from tax.
Can you bequeath EPF money to family members?
A person cannot bequeath money from EPF , EPS and gratuity to anybody other than those defined 'family' members in the Will. If there is a mismatch i.e., the money is bequeathed to someone other than the defined 'family' member, then nomination takes precedence over the will. This implies that beneficiary in the Will will not obtain the money, which will instead fall under the nominee' entitlement.
Is EPF taxed perquisite?
Aarti Raote, Partner, Deloitte India says, "The excess employer's contribution to EPF, NPS and/or Superannuation fund will be taxed as perquisite in the hands of an employee. The employer needs to calculate the amount that will be taxed as perquisite and will be reflected in your Form 16."
Is an employer's EPF contribution taxable?
That is right, for instance, the employer's contribution to the EPF account can become taxable if it exceeds a certain limit in a financial year. There are few more such instances when you will have to pay tax on EPF .
Is EPF taxable?
Here is a look at when contributions, interest earned and withdrawals from one's EPF account will become taxable. When contribution to EPF account becomes taxable. As per current law, an employee's own contribution to the EPF account is not taxable. However, effective from April 1, 2020, onwards, employer's contribution to ...
Is NPS interest taxable?
As mentioned above, if the employer's contribution to the EPF, superannuation fund and NPS exceeds Rs 7.5 lakh in a financial year, then the interest earned on the excess contribution will also be taxable.