Transfer of mutual fund units to my wife as alimony
Sam G
(Querist) 17 February 2015
This query is : Resolved
Hi, can some one please advise if I can transfer my mutual fund units to my wife as alimony payment without any tax consequences?
I have investment in debt fund and equity fund which are not 36 months or 12 month old respective, so If I liquidate the units I would have to pay short term capital gain and exit load which would be a substantial amount, can some one pls advise if there is a way to avoid redemption by transferring these units to her demat account?
I also read something about opening a trust could be another way to transfer the assets for a particular purpose, can someone can advise about the feasibility of using a trust for payment of alimony? Thanks
Devajyoti Barman
(Expert) 18 February 2015
Unless court gives such permission, you can not do so.
ajay sethi
(Expert) 18 February 2015
even if you transfer units in name of your wife exit load would be charged as you have sold within lock in period
malipeddi jaggarao
(Expert) 18 February 2015
Expert Mr.Ajay Sethi properly addressed the query. You cannot escape exit load. Even otherwise, at the same time, your wife should accept the Mutual Funds as payment of alimony. Why she will co-operate with you? Such consent of her has to be obtained through court. Otherwise, she can create a problem at a later date. Settle clearly with your wife, instead of thinking to save some tax.
Guest
(Expert) 18 February 2015
Rightly advised by experts, Shri Ajay Sethi and Malipeddi Jaggarao.
Biswanath Roy
(Expert) 21 February 2015
Mutual fund units are the part of estate of the husband which under no circumstances can be treated as payment of ALIMONY.
ALIMONY which signifies literally nourishment of sustenance, means, in general sense,the allowance required by law to be made to a spouse from the other spouse's estate for support or maintenance, either during a matrimonial suit or at it's termination, where the fact of marriage is established and the right to a separate maintenance is proved. Similarly stated, alimony is the ALLOWANCE which a party may be compelled to pay to his spouse for maintenance when they are living apart or after they have been divorced.
T. Kalaiselvan, Advocate
(Expert) 19 February 2015
