Answers On Topic: Taxation of Trusts
Hello Team, We, as a family of 4, have accumulated sizeable amount (cash) that is supposed to be used for retirement purposes. The amount accumulated is through a sale of property (the tax for this transaction has been paid). Our goal is to form a private irrevocable specified trust, introduce the cash into trust while forming the trust and then deploy that cash into debt and equity investments. Following are our concerns: 1. Tax implication while introducing the cash into trust - It is very much clear that there won't be any capital tax implication for introducing the cash into…
► Read Answer
A family trust having income by way of mainly dividend income. Share is defined and all their individual incomes are over maximum amount not chargeable to tax. Question is whether in the case of surcharge the portion of dividend income will be restricted to 15% as per finance act or full 37% need to be charged or it will depend on surcharge slab as per total income.
► Read Answer
Respected sir, A charitable trust registered u/s 12A(a) of the Act, now carrying on business activity having in excess of 20% of gross receipts wants to forfeit exemption u/s 11 . what is the itr form to be used? taxability is on net receipts (after expenses) or on grosss receipts , what is the rate of tax ? Pl elucidate
► Read Answer
A private Specific Trust wants to convert itself into Discretionary Trust. What will be the tax impact and whether it will be assumed that on conversion private specific trust is first dissolved and thereafter discretionary trust is formed? Further, the specific trust presently has huge investments in shares of various private companies and are shown at cost price the question is whether on conversion the shares will have to be revalued and brought to tax in the hands of beneficiaries at the time of conversion and further shares are held for more than 24 months, the question is whether on…
► Read Answer
Assessee is private family trust created by the setlor for the benefits of 4 minor sons of family. In the said trust father and mother of 4 sons were trustees. After few years one of the trustee was expired. The trust is later on run by the sole trustee. The sole trustee also expired after 2 years. Since 4 sons who were beneficiaries of the trust become major have decided to continue the trust by appointing two brothers out of 4 as trustees of the trust. Whether action taken by trustee is legally correct ? If not what action has…
► Read Answer
Facts : A Private Specific Family Trust is there having four major persons as its beneficiaries. Shares of all the beneficiaries are fixed and known as per the trust deed. Said Trust owns commercial building through which it receives rental income. Return of income of Trust is regularly filed and income from rent is allocated to beneficiaries according to their shares and said income is offered for tax by beneficiaries when they file their return of income (i.e of beneficiaries ) and returned income of Trust is always NIL and Trust does not pay any taxes on rental income. Now…
► Read Answer
An individual holding OCI CARD is desirous of setting up a Trust in India and be the managing trustee and the beneficiary till he is alive . He is desirous of transferring his immovable property in India and also his income from abroad to the trust. Will there be any levy of tax u/s 56 (2)(vii) as the recipient is a trust or there will be no tax as he is the transferor and also the beneficiary
► Read Answer
Formation of Trust for ring fencing and retirement income