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Will your minor child's income be clubbed with yours while filing ITR? Know when and how it is taxed
Mint 2 hrs ago·13 Sept 2026, 4:13 am
The Income Tax Act allows minors to earn income without it being taxed under their parents' name. This rule applies to income from gifts, investments, or other sources, provided it is not derived from a business or profession. However, if a minor earns income from a business or profession, it is taxed at the highest marginal rate of the parent whose income is higher.
For investors, this rule matters because it can impact the overall tax liability of a family. If a minor's income is significant, it could push the parent's total taxable income into a higher tax bracket. This is particularly relevant for families with young entrepreneurs or those managing investments on behalf of their children.
What to watch next: The government periodically reviews tax laws to simplify compliance. Investors should keep track of any changes in the tax treatment of minor income, especially if they are planning to invest in stocks or other assets in their child's name. Always consult a tax professional for personalized advice.
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