Filing Income Tax Returns for Minor children

Last Updated at: February 25, 2020
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Filing Income Tax Return for Minor children - Vakilsearch

Children nowadays seem to be very passionate and highly progressive to achieve something better in their lives. Also, this generation’s parents are equally supportive and pay attention to what their children like and want to pursue. Being a child, if he/she can perform many activities despite the regular school work, it is simply appreciable. If the child gets income for his work, then he should pay income tax returns to the government to acknowledge his earnings. Here, we will tell you how. 

Any income that a minor gets have to be added in their parent’s income as per section 64(1A). Wherein, the parents will be taxed for this by considering their children’s income as their own. According to section 64(1), income can be clubbed with any specified person by computing the total income of the individual. There are actually many exceptions and limitations to be considered before filing the income tax on a minor.

What is the age for filing Income Tax?

There is no specific age limit to file income tax returns for children. All that matters is not age, but their income. It may be from their earned money or unearned money. Earned money is the one where the children earn on their success or by winning any contest and so on. Wherein unearned money is that the money funded by a toddler’s grandparents to their grandchild for their future, etc. Income tax returns are calculated based on the minor children’s savings money or their investment. There are certain exceptions for the same. A teenager working at odd jobs need not file income tax returns.

File tax returns now

Now let us see what exactly does the income of the child means.

When a child (a minor) works in any possible way, then the income of the child is considered to be a taxable one. For instance, if he/she uses his/her special talents on any shows or wins, then it is applicable. *Exceptions are there. Or if he/she does any activity/job which is considered as legal, it is most applicable. In such cases, the minor is supposed to file an income tax return. For instance, in a very popular TV show, a child wins the title and an amount, then the child will have to pay taxes for it.

If the minor’s income is less than Rs.1500, then the income will not be added to the parent’s income. There are a few exemptions and restrictions to be followed while filing tax returns in the name of the child who gets earned or unearned money.

If both the mother and father are earning members of the family, then the income of the minor will be added to the income of that parent whose income is higher comparatively. If the parents are divorced, then the income of the child would be added to the parent who takes custody of the child. When a child is suffering from any specified disabilities which come under Section 80U, then the income of the child will not be clubbed with the income of the parent. (The child is considered as a differently-abled one only when he suffers from blindness, locomotor disability, hearing impairment, poor vision, and mental illness which are more than 40%). If the child’s parents are dead, then he/she has to file a separate income tax. However, in this case, a guardian can’t get the salary inclusion benefit from this.

Can a minor have a PAN card?

Yes, a PAN (Permanent Account Number) can be applied for a minor.

File income tax for your minor child

Conclusion

Therefore, plan in advance to pay your child’s income taxes for the financial year 2020-21. There are also many benefits while children pay taxes. Also, register PAN for your little ones today to establish an identity for them. During the financial year, if the minor child becomes 18, then he/she would be declared as major (above the age of 18). Then a major need to be taken into account of individuality. There are some exceptions in it as well as if the major is suffering from more than 40% blindness, or other disabilities according to Section 80U. 

 

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Filing Income Tax Returns for Minor children

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Children nowadays seem to be very passionate and highly progressive to achieve something better in their lives. Also, this generation’s parents are equally supportive and pay attention to what their children like and want to pursue. Being a child, if he/she can perform many activities despite the regular school work, it is simply appreciable. If the child gets income for his work, then he should pay income tax returns to the government to acknowledge his earnings. Here, we will tell you how. 

Any income that a minor gets have to be added in their parent’s income as per section 64(1A). Wherein, the parents will be taxed for this by considering their children’s income as their own. According to section 64(1), income can be clubbed with any specified person by computing the total income of the individual. There are actually many exceptions and limitations to be considered before filing the income tax on a minor.

What is the age for filing Income Tax?

There is no specific age limit to file income tax returns for children. All that matters is not age, but their income. It may be from their earned money or unearned money. Earned money is the one where the children earn on their success or by winning any contest and so on. Wherein unearned money is that the money funded by a toddler’s grandparents to their grandchild for their future, etc. Income tax returns are calculated based on the minor children’s savings money or their investment. There are certain exceptions for the same. A teenager working at odd jobs need not file income tax returns.

File tax returns now

Now let us see what exactly does the income of the child means.

When a child (a minor) works in any possible way, then the income of the child is considered to be a taxable one. For instance, if he/she uses his/her special talents on any shows or wins, then it is applicable. *Exceptions are there. Or if he/she does any activity/job which is considered as legal, it is most applicable. In such cases, the minor is supposed to file an income tax return. For instance, in a very popular TV show, a child wins the title and an amount, then the child will have to pay taxes for it.

If the minor’s income is less than Rs.1500, then the income will not be added to the parent’s income. There are a few exemptions and restrictions to be followed while filing tax returns in the name of the child who gets earned or unearned money.

If both the mother and father are earning members of the family, then the income of the minor will be added to the income of that parent whose income is higher comparatively. If the parents are divorced, then the income of the child would be added to the parent who takes custody of the child. When a child is suffering from any specified disabilities which come under Section 80U, then the income of the child will not be clubbed with the income of the parent. (The child is considered as a differently-abled one only when he suffers from blindness, locomotor disability, hearing impairment, poor vision, and mental illness which are more than 40%). If the child’s parents are dead, then he/she has to file a separate income tax. However, in this case, a guardian can’t get the salary inclusion benefit from this.

Can a minor have a PAN card?

Yes, a PAN (Permanent Account Number) can be applied for a minor.

File income tax for your minor child

Conclusion

Therefore, plan in advance to pay your child’s income taxes for the financial year 2020-21. There are also many benefits while children pay taxes. Also, register PAN for your little ones today to establish an identity for them. During the financial year, if the minor child becomes 18, then he/she would be declared as major (above the age of 18). Then a major need to be taken into account of individuality. There are some exceptions in it as well as if the major is suffering from more than 40% blindness, or other disabilities according to Section 80U. 

 

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