HUF (Hindu Undivided Family)

What is HUF?

HUF signifies Hindu Undivided Family. Save taxes by creating a family unit and pooling in assets to form a HUF. HUF is the tax charged separately from its members. A family can come together and Create a HUF. any other may form a HUF like Buddhists, Jains, and Sikhs, etc. HUF has its PAN number and file tax return independent of its members.

Tax implications of forming a HUF

How is HUF taxed?

  • HUF has its PAN and files a separate tax return. A separate joint Hindu family business is created since it has an entity separate from its members.
  • Claim Deductions under section 80 and other exemptions by the HUF in its income tax return.
  • Also take an insurance policy on the life of its members.
  • And also pay a salary to its members if they help to its functioning of the HUF and this salary expense can be deducted from the income of HUF.
  • Investments can be made from HUF’s revenue. 
  • A HUF is taxed at the same rates as an individual.

How to form a HUF?

While there are tax advantages of forming a HUF, you must also meet some conditions –

  • A-One person cannot create HUF; it can only be formed by a family.
  • A HUF is voluntarily formed at the time of marriage.
  • It consists of a common ancestor and all of his lineal descendants, including their wives and unmarried daughters.
  • HUF usually has assets which come as a gift, a will, or property acquired from the sale of joint family property or property contributed to the common pool by members of HUF.

Address
304 North Cardinal St.
Dorchester Center, MA 02124

Work Hours
Monday to Friday: 7AM - 7PM
Weekend: 10AM - 5PM