What do mean by joint Hindu family firm?
It refers to a form of business organization which is owned and carried on jointly by the members of the Hindu Undivided Family (HUF). It is also known as Hindu Undivided Family Business.
What is joint Hindu family business examples?
Reliance Industries Limited is a Joint Hindu Family business form of business organisation. It is a company headquartered at Mumbai & was founded by Dhirubhai Ambani. This company is engaged in businesses like textiles, energy, petrochemicals, telecommunications & retail.
How many types of joint Hindu family business are?
This form of organisation is only found in India. It is one of the oldest forms of business organisation in India and is governed by two systems. These are the Dayabhaga and the Mitakashara.
What are the characteristics of joint Hindu family business?
The main characteristics of Joint Hindu Family Business are given below:
- Governed by Hindu Law: The business of the Joint Hindu Family is controlled and managed under the Hindu law.
- Management:
- Membership by Birth:
- Liability:
- Permanent Existence:
- Implied Authority of Karta:
- Minor also a Partner:
- Dissolution:
What is HUF and explain its features?
The formation of a HUF does not require any documentation and admission of new members is by birth. Liability: The liability of all the various co-parceners is only up to their share of the property or business. So they have limited liability. But the Karta being the head of the HUF has unlimited liability.
What do you mean by HUF?
Hindu Undivided Family (HUF) Under Hindu Law, an HUF is a family which consists of all persons lineally descended from a common ancestor and includes their wives and unmarried daughters. An HUF cannot be created under a contract, it is created automatically in a Hindu Family.
Why HUF is created?
The primary reason behind building a HUF is to get an additional PAN card which would be legally acceptable, as well as to avail the tax benefit. After building the HUF, the members falling under HUF will not have to pay tax individually.
What are the advantages of HUF?
HUF Tax Benefits
- According to IT act, tax rebates and deductions can be availed under sections 80C for HUF account.
- Gifts collected up to a worth of Rs 50,000 will be tax free.
- Corpus can be used for investment in tax free money instruments.
What are benefits of HUF?
And being a separate entity, the HUF enjoys a basic tax exemption of Rs 2.5 lakh. So, imagine that you create an HUF consisting of you, your spouse and two children. In addition to income tax benefits you enjoy individually, you can also avail of an additional basic income tax exemption of Rs 2.5 lakh each year.
Why HUF is formed?
What is HUF and its features?
What are the limitations of HUF?
Disadvantages of the HUF
- No outside members other than family members can be introduced to the HUF.
- While the Karta has all the power he also has the burden of unlimited liability.
- Also, the absolute dominance of the Karta overall business and financial decisions make cause conflict among the HUF.
How HUF can earn income?
The entity is allowed to earn from all legitimate ways except by way of salary. It can engage in business, investing in real estate and market linked investment options such as shares, earn income through rent etc. The HUF should file for ITR (Income Tax Returns) and income earned would be taxed as per the slabs.
What are the disadvantages of HUF?
What is called joint family?
Joint family is a type of family in which two or more family live in one house. For example if some one has two son and both are married and have one or two children and living in single house. This type of family is called joint family where children live with their grandfather and uncle in same house.
What are the types of joint family?
According to Gore, joint family is of three types:
- Filial joint family (parents and their married sons with their offspring),
- Fraternal joint family (two married brothers and their children) and.
- Filial and fraternal (combined) joint family.
What are the benefits of HUF?
Who are the legal heirs of HUF?
Under Hindu Law, an HUF is a family which consists of all persons lineally descended from a common ancestor and includes their wives and unmarried daughters. An HUF cannot be created under a contract, it is created automatically in a Hindu Family.
What is Joint Hindu family business?
The Joint Hindu Family Business is a distinct form of organization peculiar to India. Joint Hindu Family Firm is created by the operation of law. It does not have any separate and distinct legal entity from that of its members. The business of Joint Hindu Family is controlled under the Hindu Law instead of Partnership Act.
What is a joint family in India?
A joint family is an important aspect of Hindu Law. It is an institution where members of the family own property in their name or Coparcener’s name. It started through a common male ancestor and continued till perpetual by birth and death of a member in the family.
Who is the head of the business in a Hindu family?
These businesses are managed by all members of a joint Hindu family. The eldest member of the family is considered the head & controls the whole business. Head of the business is called “ Karta” & looks after all the finances of business.
What is the difference between coparcenary and Joint Hindu family?
Joint Hindu family has unlimited members but Coparcenary is only limited to four generations of unlimited male members. The property acquired by a senior most male member is known as the last holder of the property. For E.g., the Coparcenary was consisting of father F, his son S1, and his son’s son S2.