Hindu Undivided Family (HUF) is a term not used under the provisions of the Income Tax Act. HUF is a family with husband, wife and children. If children and their spouses are living together, then it applies to them as well.
Under HUF, the female members are also given the right of share to the property, which has been left behind. This makes them equal heirs.
Coparceners are members of the family who acquires by birth an interest in the joint property of the family and coparcenary is restricted to four levels of living order. Only coparceners has the right to ask for partition.
Here are few pointers on HUF which you should be aware of:
1. Senior most male member of the family would become ‘Karta'. If he passes away, his wife cannot become the karta. His eldest son will take his place.
2. Earlier, omly male members were known as Coparceners. After the Hindu Succession (Amendment) Act, 2005, daughters also coparcener.
3. Under Income Tax, HUF is considered as a separate person. And each member can contribute their income to the HUF account
4. In the presence of a senior male member, a junior male member cannot be the Karta. But if all the coparceners agree, a junior male member can be a Karta. Coparceners may withdraw their consent at any time.Click to know How to reduce your tax liability through HUF?
Pan Card Required For HUF
5. As per new regulation, each PAN Card application for HUF should be supported by an affidavit on proper stamp paper.
6. To apply for PAN, Karta should submit an affidavit made by the Karta of HUF stating name, father's name and address of all the coparceners on the date of application is required along with copy of proof of identity, proof of address & proof of date of birth of Karta.
7. Format of affidavit is available on www.pancard.org.in and this format of Affidavit
8. PAN affidavit made by the Karta of HUF stating name, father's name and address of all the coparceners on the date of application is required along with copy of proof of identity, proof of address & proof of date of birth of Karta.
9. An HUF can also apply for Pan Card. The same application Form (Form 49A) can be used for applying for Pan Card for HUF but with following different procedures. In HUF Pan card, Karta of HUF will sign the application in black ink
10. The main drawback or difficulty arises when one of the HUF members wants partition.