Clubbing of income - TDS declaration

[gischethans]

When the income (Eg. SB/FD interest, dividends) earned in a non-earning wife’s account is added to the husband’s income while filing ITR, how is TDS reported? The source of interest, dividends, would be shares purchased with the money given by the husband.

I see this in ITR-2 -
SCHEDULE TDS2 - 20C(1) DETAILS OF TAX DEDUCTED AT SOURCE (TDS) ON INCOME [AS PER FORM 16A ISSUED OR FORM 16B/ 16C/16E FURNISHED BY DEDUCTOR(S)]

*TDS credit relating to self /other person [spouse as per section 5A /other person as per rule 37BA( 2)]

I was under the impression that one can add rows there, specifying spouse, PAN, TAN of the deductor, amount, etc., but I read somewhere that an application under 37BA needs to be given to the financial institution that deducts TDS to move the credit to the husband’s PAN. It would be quite a task to approach several institutions (banks/company registrars) if that is a requirement and that apparently needs to be done every year.

Here is a sample form I found - https://vipindustries.co.in/storage/tds-on-dividends/January2024/Annexure-4_Rule_37BA.pdf

Is that necessary or just filling in the details sufficient?

CC @Quicko

[Quicko]

Hey @gischethans

When income in a non-earning spouse’s account (like SB/FD interest/dividends) is clubbed with husband’s income, TDS credit can also be claimed by him
Rule 37BA(2) → wife gives declaration to bank/RTA/company so they report TDS in husband’s PAN. Safest route (credit shows in his 26AS/AIS).
In ITR-2 → Schedule TDS2, you can also claim TDS of “other person” (spouse). Just add spouse PAN + deductor TAN + TDS details.
If no declaration is filed → CPC may not match TDS with 26AS/AIS. Then:
• If credit is denied in 143(1), you file a rectification u/s 154 with proofs.
• If CPC issues a demand/notice, you respond to it with the same docs.
Best practice: give 37BA declarations each year. Disclosure in ITR works too, but be ready for CPC mismatch handling.

Hope this helps!

[S_Balaji]

@Quicko your response is very clearly AI-generated. People can ask chatbots themselves if they want - they come to you for responses from human professionals.

Kindly keep AI responses out of forum posts or at the very least clearly label it as AI so people are aware. Perhaps @Meher_Smaran or other mods can clarify the policy on such responses.

Edit: I also suggest for anyone who is using LLMs to prompt it to include links to the websites from which the info was pulled so that it can be verified that the AI is not hallucinating or missing some nuance. Our tax system is unfortunately full of nuances and its easy to misstep.