IT Notice doubt about spends done on add on Infinia

[LiamHouse]

I was wondering how the IT notice situation will be in case of add on cards. I was looking to getting an Infinia add-on from my brother because I'm not eligible for one. He files an ITR of about 19L a year and he himself spends close to 15-17L a year on his card (got the card on the basis of FD a year ago). My expenses will be 3-5L a year (I don't file ITR as I am a student and will be mainly spending the money on gyftr vouchers and flights) and it will push the total amount spent on the card over his 19L ITR.

I know there will be a notice from the IT department if you spend more money on your credit card than what you report as income but are there provisions for add-on cards? Will there be any issues for my brother, or can he simply just show the statements in case of a notice which will indicate the extra spends were done by me and paid for from my personal bank accounts using third party apps; no money will be sent to his bank accounts regarding this.

 

[SSV]

I was wondering how the IT notice situation will be in case of add on cards. I was looking to getting an Infinia add-on from my brother because I'm not eligible for one. He files an ITR of about 19L a year and he himself spends close to 15-17L a year on his card (got the card on the basis of FD a year ago). My expenses will be 3-5L a year (I don't file ITR as I am a student and will be mainly spending the money on gyftr vouchers and flights) and it will push the total amount spent on the card over his 19L ITR.

I know there will be a notice from the IT department if you spend more money on your credit card than what you report as income but are there provisions for add-on cards? Will there be any issues for my brother, or can he simply just show the statements in case of a notice which will indicate the extra spends were done by me and paid for from my personal bank accounts using third party apps; no money will be sent to his bank accounts regarding this.

Yes add-on cards spends will be clubbed with the main card account and will be reported in SFT section of AIS accordingly…

 

[Saipsy]

Has sft been updated for anyone yet?

 

[LiamHouse]

Yes add-on cards spends will be clubbed with the main card account and will be reported in SFT section of AIS accordingly…

Yes I know it will be reported but I'm talking about will it be possible to respond to the report saying the payments were made on an add on card and not personally by my brother. I will have the receipts and everything in case I need to respond but I want to know if it will be an issue for him or just a simple "he did it not me so ask him"

 

[SSV]

Yes I know it will be reported but I'm talking about will it be possible to respond to the report saying the payments were made on an add on card and not personally by my brother. I will have the receipts and everything in case I need to respond but I want to know if it will be an issue for him or just a simple "he did it not me so ask him"

He CAN explain the whole scenario of the true transactions.. if they are spent by you , they are spent by you.. IT will listen..
Your brother has just need to account for all transactions like who had done, how were they paid , the source of payment etc…

 

[RajeshV]

As long as you can explain your sources and the income was properly taxed, nothing to worry about.

 

[RajeshV]

Yes I know it will be reported but I'm talking about will it be possible to respond to the report saying the payments were made on an add on card and not personally by my brother. I will have the receipts and everything in case I need to respond but I want to know if it will be an issue for him or just a simple "he did it not me so ask him"

Receipts and all won't be required (this isn't a business expense), only where you got the money from matters. He can't just say "ask him", since what goes on even the add-on card is his responsibility. He will have to do the responding.

 

[LiamHouse]

Receipts and all won't be required (this isn't a business expense), only where you got the money from matters. He can't just say "ask him", since what goes on even the add-on card is his responsibility. He will have to do the responding.

I will be using the money given to me by my father (he files his ITR but doesn't want any cards on his name) and I will be buying the stuff for our family spendings. If I just maintain the transactions from the statements (which are separated by HDFC per add on card basis) and when I have paid these bills from my personal accounts using a third-party app then I will have nothing to worry about right? since I can simply give this collection of information to my brother who can forward it to IT if they send a notice. Do I have this right? @SSV

 

[sourpai]

While there can be explanations etc. It is anyone's guess on how IT will respond to these explanations.

More importantly, why do you want to invite the IT scrutiny and get into explanation mode? Not sure if this is worth the hassle. And if you happen to need a CA for explanation, then extra expenses will happen on fees etc. Think of all these factors and then decide

 

[LiamHouse]

While there can be explanations etc. It is anyone's guess on how IT will respond to these explanations.

More importantly, why do you want to invite the IT scrutiny and get into explanation mode? Not sure if this is worth the hassle. And if you happen to need a CA for explanation, then extra expenses will happen on fees etc. Think of all these factors and then decide

I want to know everything before going through with it which is why I'm asking on this forum in the first place. We already have a CA who files ITR every year, but I wanted to ask here first.

 

[sidp]

I was wondering how the IT notice situation will be in case of add on cards. I was looking to getting an Infinia add-on from my brother because I'm not eligible for one. He files an ITR of about 19L a year and he himself spends close to 15-17L a year on his card (got the card on the basis of FD a year ago). My expenses will be 3-5L a year (I don't file ITR as I am a student and will be mainly spending the money on gyftr vouchers and flights) and it will push the total amount spent on the card over his 19L ITR.

I know there will be a notice from the IT department if you spend more money on your credit card than what you report as income but are there provisions for add-on cards? Will there be any issues for my brother, or can he simply just show the statements in case of a notice which will indicate the extra spends were done by me and paid for from my personal bank accounts using third party apps; no money will be sent to his bank accounts regarding this.

Yes it will show up in his ais.
But the excess amount won't be that high.
When ITD sends notice they will ask you to send some documents and explanation.

There he can mention that he has a younger brother who is dependent of his father who file xyz itr.
As your father doesn't want any cc in his name out of convenience you have gotten an add on on your brother's name. Still you father pay for your expenses not him.

To be safe you should pay your part of expenses from your account directly. As long as you can show cash inflow & outflow, there should not be a problem.

 

[SSV]

I will be using the money given to me by my father (he files his ITR but doesn't want any cards on his name) and I will be buying the stuff for our family spendings. If I just maintain the transactions from the statements (which are separated by HDFC per add on card basis) and when I have paid these bills from my personal accounts using a third-party app then I will have nothing to worry about right? since I can simply give this collection of information to my brother who can forward it to IT if they send a notice. Do I have this right? @SSV

Yes , correct.. as long as all the transactions are accounted for and the source, in your case, your father’s money.. then there won’t be any issue..

You can spend 100 crores also on CC as long the source is accounted for and that account led money was taxed..
Don’t worry nothing happens in your case..

As your brother already have a record of high spends on his CC adding another 3 or 4 lakhs won’t be any issue and there is a huge analytical that happen before an it notice is served..

Have fun…

 

[LiamHouse]

Yes , correct.. as long as all the transactions are accounted for and the source, in your case, your father’s money.. then there won’t be any issue..

You can spend 100 crores also on CC as long the source is accounted for and that account led money was taxed..
Don’t worry nothing happens in your case..

As your brother already have a record of high spends on his CC adding another 3 or 4 lakhs won’t be any issue and there is a huge analytical that happen before an it notice was served..

Have fun…

I had another question about add-on cards. Lets say I get 3 add on cards (with all different numbers) for my family but I'm the only one using the primary card. Will their cards be closed by the bank because they have not done any transaction over a year or does this practice not apply to add-on cards?

 

[SSV]

I had another question about add-on cards. Lets say I get 3 add on cards (with all different numbers) for my family but I'm the only one using the primary card. Will their cards be closed by the bank because they have not done any transaction over a year or does this practice not apply to add-on cards?

I am not qualified to answer these expert level questions on add-ons as I am a solo guy