Tax Talk

My father had an HUF account and a PAN associated with it through which he paid all taxes on our agricultural and rental income. He was the Karta and my mother and me (33-year-old daughter) are the members. With his demise three years ago, we are unsure on how to continue with the HUF PAN and, in our case, who would be the karta with two surviving female members. We are still paying taxes using the old HUF PAN. Now I am married and have a three-year-old son. Can we open a new HUF account with a new PAN with my mother being Karta, and my husband and me being members to club the HUF income and pay taxes via that. Can a minor grandson have any role to play in that? Or, can we continue using the old PAN ? But we are not allowed to open any new bank accounts using that PAN. How should we manage this?

Kalpana Singh

Erstwhile provisions of The Hindu Succession Act, 1956 (law) provided co-parcenary rights to the eldest son of the Karta. With the amendment to the law in 2005, unmarried and married daughters can become co-parceners by birth. The Karta’s wife or daughter-in-law cannot become Karta of the HUF.

As you are the sole co-parcener, you could become Karta of your father’s HUF. The HUF will continue with the existing PAN. Your mother cannot qualify as Karta but can continue as member. Further, your husband and minor son cannot become members of this HUF as they are not lineal descendants of your father. For this purpose, you would be required to change the name of the Karta in the HUF account. Bankers would require the death certificate of the Karta with a declaration from the surviving members together with details of the new Karta.

I am 65 and my wife 62. We don’t have any medical insurance and often spend from our pocket for medical treatment and medicines.

I understand that for senior citizens above 60, who do not have health insurance, deduction is allowed up to ₹50,000 from taxable income towards medical expenditure under Section 80D from FY 2018-19/AY 2019-20.

I want to know what are the (a) exact conditions/requirements to be met and (b) documents required to be maintained for getting the above deduction (in the absence of any medical insurance policy).

Mayank Sharma

As per the provisions of the Income Tax Act, 1961, senior citizens above 60 may claim payment made towards medical expenditure as a deduction from the gross total income. However, it can be claimed up to ₹50,000 during a financial year, subject to fulfilment of conditions mentioned below:

Cost of medical expenditure should be by any means other than cash;

There should not be any Mediclaim insurance policy in force covering health of such senior citizens. Documents with evidence of medical expenditure to substantiate the claim before the tax authorities, must be maintained.

The witer is Partner, Deloitte India. Send your queries to taxtalk@thehindu.co.in

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