I am 47 years old and for higher returns from company fixed deposits (FDs), I transfer money from my bank account to my 82-year-old father’s linked account. He invests in FDs from his account and submits Form 15H. If the FD’s maturity amounts credited to my father’s account are transferred to my account through NEFT, will it be taxed in my hands? —Name withheld on request
It appears that the funds are merely invested in the name of your father for your benefit and the funds along with income are ultimately returned to you i.e. it is a revocable transfer of asset. Hence, the income generated on such funds (invested in your father’s name in order to earn a higher rate of interest) would be taxable in your hands.
