Hindus, Sikhs, Buddhists and Jains are eligible to form an HUF
1. The Hindus, Sikhs, Buddhists and Jains are eligible to form an HUF. The HUF includes all lineal descendants of a family, including the husband, wife and children.
2. The HUF comes into existence as a result of a marriage. It can also be created with the money received as gift from ancestors or via the transfer of any ancestral assets.
3. The seniormost male member is designated as the karta and is the authorised signatory of the Hindu Undivided Family
4. The HUF can maintain a bank account, invest the initial corpus as well as gifts received, and earn returns or capital gains from investments.
5. For the purposes of investment and taxation, an HUF is a distinct entity like an individual, has a separate PAN card, and is assessed accordingly.