This article is written by Ramanuj Mukherjee, CEO and Co-Founder at iPleaders.
Hindu Undivided Family (HUF) can save you a lot of tax money. If any of your Hindu friends got married recently, they can set up an HUF and save tax on at least 3-5 lakhs of their income if they transfer some of the income in name of the HUF. However, for that they need to set up the HUF first and get a PAN card for the HUF. Before doing anything else, you need the below HUF deed to be prepared. No stamp paper is required. Here is the template you need to set up HUF.
HUF CREATION DEED
DECLARATION BY KARTA
I, [insert name of Karta – oldest male member], son of [insert fathers name of Karta, insert his address], aged [insert age], do hereby declare:
That I am Karta of an HUF namely [insert surname/family name] family residing in the above mentioned house consisting of me and my wife [insert wife’s name, and also names of children and other family members if there are any];
That I received on behalf of the HUF gift of Rs. [Insert amount] by way of CASH from my FATHER [Insert Fathers name] on [insert date] which formed the corpus of the HUF;
That the HUF at present is consisting of the followings members:
- [Insert Karta’s name], [Adult], [insert complete address] and
- [Insert name of Karta’s wife], [Adult], [insert complete address] and
- [Insert name of children if any] [Minor], [insert complete address];
That the above statements are true to the best of my knowledge & belief.
[Insert Karta’s name]
Date: [Insert date month and year]
[Insert name of Witness 1], resident of [Insert Address of Witness 1]
[Insert name of Witness 2], resident of [Insert Address of Witness 2]
DECLARATION OF GIFT MADE BY [Insert Surname/family name] FAMILY HUF AT [insert location] TO THE HINDU UNDIVIDED FAMILY OF [Insert family name/surname] HUF at [Insert location 2]
I, [name of Karta of original HUF], residing at [insert address of original HUF], do hereby declare and affirm as under:
That out of natural love and affection borne by me towards the Hindu Undivided Family of [Insert name of Karta of new family] and [Insert name of wife of karta of new family], I have made a gift of Rs. [insert amount] ([amount in words] only) by cash, in favour of [Insert name of Karta of new family] and [Insert name of wife of karta of new family]’s Mukherjee family HUF located in [insert location].
That the above Gift has been duly accepted by [insert name], as Karta of his Hindu Undivided Family and has been duly acknowledged hereunder.
That this Declaration of Gift is made to record the fact that I have made this Gift in favour of the HUF as above, who now has the absolute right, title and interest in the gifted amount.
(Signature of the Donor)
ACKNOWLEDGEMENT OF GIFT
I, [insert name of the karta of new family], hereby acknowledge having received the above gift made to my Hindu Undivided Family by [insert name of karta of original family].
Date: [insert date]
(Signature of the Donee as Karta of his HUF)