Income tax savings through senior citizen parents
Talking on the subject, he says since the basic income tax exemption for a 60-year plus and 80-year plus senior citizen is Rs 2.5 lakh and Rs 5 lakh respectively, it is a good idea for the tax payer to give away money to his/her parents and then parents make investments in their own name.
Here are a few questions he has answered:
Q: Senior citizens enjoy a higher basic tax exemption limit along with a higher rate of returns on savings. Would it make sense for big family investments to be made in the senior citizens’ name? I am referring to investments which are over and above the purview of 80C?
Q: What if the heirs start fighting for it afterwards?
Q: I am a professional who owns a property which is rented out. The property is in joint name of my wife and me. It is a freehold property with no loans. Can gifting this property to my wife reduce my tax liability?
Go here to read the answers.