Are you a housewife? Check for these incomes
As a housewife, you might be thinking that you do not need to file I-T Return since you do not earn any income. Yes. You are right! As per law, you do not need to file I-T Return. However, it is an all-win situation for you, if you file I-T Return, we will discuss this later. As a housewife, you may be having a bank account and your husband who is an earning member of the family must be paying you money in your bank account so that you can withdraw for expenses as per requirements of your household budget. If he is giving you cash withdrawn from his bank account, we suggest you use your bank account since one bank account becomes operational in your name which may become handy in case of future loans or financial transactions. As a housewife, you can have a few kinds of income, though they may not be taxable, it is better to know.
1. Money received for household expenses
This is not exactly your income but the money you have received from your spouse or earning member of the family for household expenses or home budget. This money is from the tax-paid income, so it’s not again taxed in your hands. However, be the amount of such money, it’s not taxed. In case the household expenses are exceptionally high and such amounts are deposited in your bank account by your spouse and you are withdrawing cash or spending from that account. It may happen that this account, because of the quantum of the transaction, maybe flagged by the Income-tax Department and they will try to see whether the account holder housewife is filing the I-T Return. Though such situations are rare, in order to avoid unpleasantness borne out of such situations, it’s better to file I-T Return.
2. Interest Income
As a housewife, it is highly likely that you may earn interest income on account of two reasons, first, your parents may have invested in fixed deposits or similar instruments in your name before your marriage or you may have received gifts from them or relatives which you have invested in such deposits which are earning interest income. Secondly, the money that you receive for household expenses in your account must not be getting wholly spent and gradually accumulate in your bank account which may yield an interest income to you. In the first instance, the said interest income is to be declared in your hand, and in second instance its to be clubbed in the hand of your husband as his taxable income. In case of the amount in your hand, it becomes taxable in case it exceeds the amount of ₹250,000/-.
3. Gifts received
As a housewife, you might receive gifts from relatives, friends, and family. Those received from specified relatives and close family are fully tax-free whereas those received from others of more than ₹50,000/- are taxable in your hands. In case you have received gifts in any of the years then you must check whether those gifts are to be declared as taxable or tax-free in your I-T Return. In order to bring all such gifts on record so that there won’t be any questions on in future, it’s always better to file I-T Return.
4. Sale of jewellery
In case you have sold any jewellery, items made of gold, and received money or other ornaments in exchange, this transaction may fall in the scope of capital gains. Consider you have received gold ornaments of Rs. 200,000 from your relative for any occasions like weddings, etc you need to report such exempt income as a gift in your income tax returns. If you fail to report and you sold them in a particular year for ₹400,000/-, the profit shall be considered of ₹400,000/- (& not Rs. 200,000- as you don’t have any proof to show the acquisition).
If you have reported the gift income of Rs. 200,000 and sold the ornaments for Rs. 400,000 then profit shall be considered as Rs. 200,000, for computing taxable income from capital gains, though there will be indexation applied and methods followed. This means as a housewife you also can have such kinds of income that need to be declared in the income tax returns and hence the I-T Returns must be filed.