Experts Explain if a Minor Has to File Income Tax Returns

When it comes to submitting an Income Tax Return (ITR), age is not a defence. Only tax payers are aware that teens and children must also file tax returns and pay taxes if they get any income. There are, however, some restrictions and exceptions. More than 4800 juveniles under the age of 18 submitted ITR in FY 2022–23 through January 31st, 2023. This article examines the ITR filing and taxation regulations for minors/children under the age of 18.

According to tax experts, young people, including kid influencers, with a source of income are required to pay taxes on their income just like any other worker.

Abhishek Soni, co-founder, and CEO of Tax2win, a Fisdom company, states that minors who are under the age of 18 and have money in the form of earned or unearned income or who engage in certain transactions (subject to certain restrictions) are required to pay taxes.

According to income tax regulations, people under the age of 18 are deemed minors and are subject to a different tax rate. Sujit Bangar, the founder of Taxbuddy, says that minors are not needed to submit their own tax returns, and their income is combined with that of their parents or legal guardians.

Children and minors may be liable for taxes under the following circumstances:

Earned money: When kids make money using their specific skills, such as by taking first place in a competition or tournament. The salary amount is also included in this money.

Unearned income: Amounts that a minor receives as gifts from family members, grandparents, or through investments their parents made in their names, as opposed to amounts that they directly earn.

Any sum a minor gets must be included in the parent’s income in accordance with Section 64(1A) of the Income Tax Act. The term “clubbing of Income” refers to this. Therefore, taxes on such income will be paid in the same manner as taxes on the income of the parent.

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