Income of minor child – Clubbing Provisions

The scope of clubbing the income of minor child has considerably been enlarged with effect from assessment year 1993-1994 by insertion of sub-section 1A to section 64 of the Income Tax Act, 1961 (the Act). Accordingly the income of minor child has to be clubbed with the income of the parent, whose income is higher. But many a times question arises that in case of minor’s income whether deductions or tax rebates will be computed in the hands of minor or parent or whether clubbing of income of minor clubbed in the hands of particular parent can be clubbed in the hands of other parent in subsequent year.  Such issues are discussed hereunder:

As per Section 64(1A) of the Act, the income of minor child is required to be clubbed with the income of the parent, whose income is higher and where the marriage of the parents does not subsist, the income of minor will be includible in the income of that parent who maintains the minor child in the relevant previous year. The following are the exceptions:

  • the income of a physically handicapped minor child
  • income of minor child from any manual work done by him or
  • income of minor child on account of any activity involving application of his skill, talent or specialized knowledge or experience.

As per Section 10(32) of the Act, out of the income clubbed under the new provisions, deduction of income upto Rs. 1500 per child will be allowed. Thus, if the income of any minor child is less than Rs. 1500, the same will not be clubbed, but if the income is more than Rs. 1500, amount in excess of Rs. 1500 will be clubbed. However, no similar deduction has been provided for the purpose of Wealth Tax.

Where any such income is once included in the total income of either parent, any such income arising in any succeeding year shall not be included in the total income of the other parent, unless the Assessing Officer is satisfied (after giving that parent an opportunity of being heard) that it is necessary to do so.

Tax Returns for Financial Year 2010 -11 (March 2011) has started.  Just mail us Form16/ Salary Certificate and details of other income, at . We would take it from there to file your return of income. provides complete online taxation solutions for individuals ( Tax Returns + Tax Support + Tax Planning ) – please see this – Services Offered. Providing Complete Online Tax Solutions for Individuals, Not Just Returns .

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