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This article provides detailed information on the account opening procedure of HUF (Hindu Undivided Family) account. Read on to know more about the features and tax benefits of HUF account.

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What is HUF Account?

Hindu Undivided Family (HUF):-
HUF is a family with husband, wife and children (and children’s spouses if any) living together. The property owned by this family will be through lineal ascendants or any ancestors. There are a set of laws that govern property ownership, marriages, taxation etc for a legally declared HUF. IT department of India has a format of taxation for a HUF; tax benefits can be availed from this format.
 
HUF accounts:-
Karta of a HUF is the senior most male member of the family and in financial terms he can also be called manager of the family. In this account a corpus is created where every family member can pool their income. The corpus will be handled by or authorized to handle by Karta (head of the family). Signature of karta will be required for every transaction from the bank. These accounts are similar to individual saving bank accounts; there will be various tax benefits that are available for an individual’s account while the income of members is being pooled in HUF account.
 
Features of HUF account:-
There are a few features of HUF account that makes it different from regular saving bank accounts.
  • Every member of the family can deposit their income in the common corpus
  • Single person’s authority while participation from entire family
  • Tax benefits on deposits under various sections
  • Corpus can be divided only on agreement of every coparcener of the family 
Documents required for opening HUF account:-
There are few documents that will be required for opening an HUF account.
  • HUF will have a unique PAN card; this PAN card along with the PAN of Karta should be produced.
  • A declaration form will be provided where every member has to make a signature stating the name of Karta and declare
    1. They are the only members of HUF.
    2. Karta to have sole authority over HUF account
    3. Every transaction on behalf of HUF account, made by each member of the family is governed by karta.
  • Residential proof of Karta
  • Identification proof of Karta
Apart from the points mentioned above there can be other documents or conditions depending on the bank where HUF account is opened.
 
Tax benefits on a HUF account:-
  • Since the account is equivalent to an individual’s account there are various tax benefits and a few of them are mentioned below.
  • According to IT act, tax rebates and deductions can be availed under sections 80C, 88 and 80L for HUF account.
  • Gifts collected up to a worth of Rs 50,000 will be tax free. A father who owns a HUF account can gift a property or money of higher worth to a son who owns a smaller HUF account; but he should specify that the gift is for the son’s HUF and not to him as an individual. Under section 64(2) and 56(2) tax benefits can be enjoyed in such instance.
  • Corpus can be used for investment in tax free money instruments. 
Disadvantages of HUF account:-
  • There can be a strong sense of insecurity among members that can keep the corpus of the account empty and as long as corpus is empty the account is non functional.
  • If any of the members of HUF is willing to for a partition then the process of partition in deposit in HUF account can turn to be tedious (problematic).


  • BABU RAO TOKALA:
    whether karta is eligible for staff benefits in HUF account if he is retired staff of that particular bank
    20-Sep-2016 02:31 AM
  • Rakesh Jain:
    Can HUF be created by WILL of Grandfather of his grandson who is married and has a daughter only.
    27-Aug-2016 01:06 AM
  • subhash chander:
    wether other than karta any member of the family to stop operation in the account
    22-Aug-2016 01:49 AM
  • S M Shetty:
    Hei
    Other than IT benefits , are there any other benefits in forming HUF in India
    ?
    Thanks
    02-Aug-2016 09:20 AM
  • dines:
    can i give my property on lease as Karta however property is in my indiviudal capacity not on HUF name
    20-Jul-2016 11:41 PM
  • jasvinder singh:
    in HUf a/cs can a chq be issued for the deposit in personal a/c of karta.If yes what are the precautions to be taken.IF NO what is the reason for refusal
    20-Jul-2016 10:21 PM
  • STDileepan:
    Can personal saving be made into huf by creating a new huf to avoid income tax
    11-Jul-2016 10:27 PM
  • mohit ajmera:
    can huf have saving bank a/c with other individual jointly
    08-Jun-2016 09:16 PM
  • S.S.RATHAKRISHNAN:
    I have some bank deposit in my HUF a/c.
    Please inform nomination is allowed for the
    HUF a/c bank deposits or not.

    Thanking you,
    Regd
    S.S.RATHAKRISHNAN
    01-Jun-2016 05:26 PM
  • Ishwar singh:
    Dear Bank,

    This account valid for finance.
    27-May-2016 08:18 PM
  • SUNIL KUMAR ARORA:
    When karta of HUF account i.e. male member dies can her wife be the karta of that deceased account
    02-May-2016 09:19 PM
  • ARVINDKUMAR MANILAL PATEL:
    MAY I OPEN HUF ACCOUNT ?
    MAY FAMILY MEMBER INFORMATION US UNDER
    (1) I AM ARVINDKUMAR MANILAL PATEL( 45 YEAR)
    (2)MY WIFE NAME IS MANJULA ARVINDKUMAR PATEL(44 YEAR)
    (3) MY SON NAME IS DHRUV ARVINDKUMAR PATEL(17 YEAR)
    25-Apr-2016 09:02 PM
  • r b garg:
    if any member wants partition who will solve the problem

    or can we make share division initially
    10-Apr-2016 08:32 PM
  • R.K.Kayan:
    Like banks can I open HUF Saving account in Post office.
    02-Apr-2016 03:05 AM
  • Kishor:
    Whether a Fixed Deposit in the name of HUF be made joint with any member or other individual?
    19-Mar-2016 04:07 PM
  • Kam:
    1) How to get unique PAN for HUF a/c ?
    2) What documents are required for opening HUF a/c ?
    13-Feb-2016 09:50 AM
  • K.R.Belosay:
    1 ) Format of the DEclaration for opening HUF a/c is required
    2) Can any NRI open HUF a/c in India ?
    13-Feb-2016 09:32 AM
  • NAND LAL JHAMARIA:
    I am 62years Hindu male My self and my wife retired from Govt.job 2years back,My son is married workingin USA,mydaughter is un married working in Chandigarh.We want to open a HUFActt. for tax benifits and planning.
    10-Feb-2016 09:16 PM
  • paresh Kinkhabwala:
    my mother had HUF and she passed away in1990, it was only her name can i as her son use the same name or should i form new HUF and transfer investment in new HUF a/c
    02-Feb-2016 05:17 PM
  • Balaram Himalayan:
    Please guide me.I want to open the account HUF. WHAT ARE BENIFIT WHICH I CAN GET TO SAVE MY INCOME TAX. Can give the gift to my wife and daughter in law both are the family member of HUF
    25-Jan-2016 10:18 PM
  • K.D.Sivaprakash:
    My father is a HUF a/c holder and he is expired on 20-8-2009. He is return filed upto 31st March 2007. Now I get Income tax department notice to my father name and they told to file returns. Now what can I do? and myself is not HUF a/c holder
    20-Jan-2016 01:13 AM
  • Srinivasan Iyengar:
    Can there be a Nomination to HUF account. Is there a RBI guideline for the same.
    24-Dec-2015 12:03 AM
  • MALLIKA:
    WHY BANKS DO NOT LEND LOANS TO HUF CUSTOMERS?
    09-Dec-2015 01:35 AM
  • haresh thacker:
    we have already formed a huf unit.
    now we want to add our children names in it/
    what is the proceeder to do it?
    pl.infrm.
    thanks
    -hb
    08-Dec-2015 04:59 PM
  • B M BANSAL:
    HOW THE GIFT CHEQUES IN THE NAME OF COPARCENER CAN BE DIPOSITED IN HUF A/C. Pl guide me n oblige. Thanks.
    16-Nov-2015 09:35 PM
  • Rohit A Dhandha:
    Is service person can open HUF account ? or is necessary that person have buisness ?
    04-Aug-2015 02:07 PM
  • COL RAJ KUMAR:
    U have not mentioned anything about PPF of members /coparceners.I have read that PPF a/c can be opened and benefit availed in HUF by opening PPF a/c of members/coparcener.My quarry is can members/coparceners PPF a/c be used for taking benefit u/s 80
    17-Apr-2015 08:00 PM
  • Satish Vohra:
    Can I transfer the whole amount kept in HUF to my personal account ? What is the tax liability
    03-Apr-2015 06:27 PM
  • Drupad vora:
    madam
    On formation of HUF, if one of the family member is already live saperately, and if he is not willing to join/participate/ or to be member in HUF can HUF can be create or to desolve

    If one of the member wants to quit HUF, can it be done
    what will be the position of their spouces-whether they are willing to continue or they have to get out
    20-Feb-2015 07:43 PM
  • P.RAMAWAT:
    Myself, my wife and our minor son aged about 16 yrs. can open a bank account in the name of Purushottam Ramawat HUF in any nationalised bank. This is particularly asked because bank has refused to open as there is no male member other than the Karta. as there is no co-personer adult male member and female adult member can not be. we have all the documents with us including PAN Card in the name of HUF. Regards. Purushottam Ramawat, Kolkata, India.
    28-Jan-2015 10:48 PM
  • Mira Patel:
    How you can dissolve HUF account? What precaution to take during that process? Please can u give some more information?
    24-Dec-2014 12:39 PM
  • bajaj:
    wen karta of HUF account dies then who will qualify as karta of that HUF account
    21-Jul-2014 10:23 PM
  • Mehul Bhatt:
    Who is karta of HUF, Who is covered under HUF ? Please help with supreme court judgement in this regard,
    21-Jul-2014 12:21 AM
  • rajesh:
    Can a same KARTA have
    1. two HUF with different name
    2. same name as HUF1 & HUF2
    07-May-2014 08:11 PM
  • R D VANIYA:
    What is procedure for getting PAN for HUF
    20-Apr-2014 04:18 AM
  • rattan lal:
    I wish to open an HUF account wherein I shall be karta with other members shall be my wife & 2 sons, both minor.

    In case I die before my elder son become major then who can operate the HUF account, during my absence.
    16-Feb-2014 10:15 PM
  • kailash ch panda:
    what is the procedure to open a HUF a/c in the bank ?
    12-Feb-2014 07:16 PM
  • sonali:
    Respected Aruna Ji,

    Kindly Advice :

    Can karta of HUF be changed? For example, say there is a HUF like AW HUF where AW is the karta and other members of HUF are Karta's wife and sons.
    Now, AW (Karta) wants to retire as Karta and one of his sons to become Karta of AW HUF.

    It is to be noted that AW is still alive.

    Thanks
    28-Nov-2013 08:09 PM
  • Tarun:
    When karta of a HUF account dies, who will qualify as karta of that HUF account?
    03-Aug-2013 10:56 PM
    • PRAMOD: NEW KARTA PREFERABLY SENIOR MOST PERSON IN FAMILY WII PREPARE A NEW DOCUMENT FOR RUNNING HUF
      22-Dec-2015 10:47 PM
    • deepa gholap: when karta dies in huf who is the next
      02-Apr-2016 03:55 AM
    • vinay kumar: if karta of huf expire then who can operate the account
      13-Jun-2016 04:13 AM
    • PRASHANT KUMAR S8NGH: Nice informations wanted to know more about HUF.
      09-Sep-2016 03:57 PM
  • vivek mittal:
    I wish to open an HUF account wherein I shall be karta with other members shall be my wife & 2 sons, both minor.

    In case I die before my elder son become major then who can operate the HUF account, during my absence.
    23-Jul-2013 09:07 AM
    • narayana: after death of kartha, who will operate the account
      02-Apr-2016 01:23 AM
    • aman: Your wife will operate the huf account after your death
      05-May-2016 01:27 PM
  • rekha sharma:
    Mam, I want to know whether mother of Karta can gift money to her son for creation of his HUF.

    Father of Karta has expired. Kindly reply
    17-Jul-2013 02:52 PM
  • shrikant:
    Can I open huf account in maharashtra bank ?
    05-Jul-2013 01:55 AM
  • VS.Mantrala:
    My wife's brother passed away recently, he was Karta of HUF with wife and 2 minor kids.
    This HUF has more than 10 lakh worth demat shares now what should be done
    25-Jun-2013 09:03 PM
  • rashmi:
    is nomination to be obtained in huf a/c?
    06-Jun-2013 01:16 AM
    • Vinod Kumar Gupta: Can nomination be made in HUF account?
      27-Jan-2015 04:30 PM
    • gaurav verma: no nomination facility is available in this HUF accounmt.
      15-Jan-2016 04:59 AM
    • santosh: Can nomination be obtained for HUF accounts ???????
      04-Apr-2016 06:58 PM
  • lk sharma:
    Can the income of property owned by karta
    & his wife be included in huf a/c?
    29-May-2013 01:18 PM
  • ASHOK.K.GAUTAM:
    What is the mandate of declaration which has to be given while forming a HUF ?
    13-May-2013 02:38 PM
  • pallavi kadam:
    Can we appoint Mandate holder in HUF A/c ?
    08-May-2013 12:29 PM
  • Vivek:
    Dear Sir,
    I am a bachelor. Can I open HUF account.
    my father is retired. can I become a karta and create HUF a/c
    02-Apr-2013 08:06 PM
  • Ashwani Kumar:
    I can avail any extra rebate from Income Tax as Karta of the family, whenever I have availed all the benefit of the rebate as to an employ. Please tell me that Can I avail any extra benefit, working as Karta of the family or otherwise.
    16-Feb-2013 01:28 PM
  • PRADEEP L.CHAUDHARI:
    CHEQUES,DRAFTS OR RTGS IN FAVOUR OF PERSONAL NAME OF KARTA OR IN FAVOR OF OTHER MEMBER OF HUF FAMILY CAN DEPOSITED IN HUF ACCOUNT OR NOT... PLEASE REPLY .. URGENT PLEASE..........
    15-Feb-2013 02:08 PM
    • TULASINATH: CHEQUES,DRAFTS OR RTGS IN FAVOUR OF PERSONAL NAME OF KARTA OR IN FAVOR OF OTHER MEMBER OF HUF FAMILY CAN DEPOSITED IN HUF ACCOUNT OR NOT... PLEASE REPLY .. URGENT PLEASE
      04-Jun-2016 05:48 PM