I have started my Business in the year 2017.As on 1-04-2018 my capital in business was Rs.300,000. My Husband gifted Rs.200,000 on 15-04-2018 which was invested in business. My profit from the same business is Rs.10,00,000.What is the amount of income that can be clubbed in the hands of my husband?

Section 64(1) of the Income Tax Act, 1961 provides for the clubbing of income in the hands of the individual.

In this case Income earned for the year 2018-19 is Rs.10,00,000. This Income is earned by using Rs.300,000 of own Investment and Rs.200,000 which was gifted by husband.
So the Income which has to be clubbed in the hands of husband depends upon the ratio of Contribution in Capital. In this case ratio of Contribution of Wife and Husband is 3:2 respectively.

Therefore , Income to be clubbed in the hands of Husband is Rs.10,00,000 * 2/5 = Rs.4,00,000.

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