New Delhi: As the Union Budget 2026 draws closer, married taxpayers in India could soon have a reason to cheer. The Finance Ministry is considering introducing an optional joint taxation system that would allow couples to file their income tax returns together.
If implemented, the move could ease the tax burden for many households, especially single-income families by offering potential savings. The proposal comes from the Institute of Chartered Accountants of India (ICAI) and is inspired by tax systems in countries like the US and Germany, where joint tax filing for married couples is already allowed.
Under the current income tax system, individuals are taxed separately, irrespective of whether they are married or not. Each spouse has their own tax slabs, exemptions and deductions. As a result, in single-income households, the non-earning spouse’s tax benefits often remain unused. This leads to a higher overall tax burden for the family.
To tackle these issues, the Union Budget 2026 may introduce an optional joint taxation system for married couples. Under this proposed regime, couples would be allowed to file a single, joint income tax return instead of separate ones. Importantly, the option would be voluntary, giving taxpayers the flexibility to either stay with the current individual taxation system or choose joint filing. This option would be available only if both spouses have valid Permanent Account Numbers (PANs), ensuring smooth compliance and avoiding any disadvantage for dual-income families.
Under the proposed system, the incomes of both spouses would be combined and taxed under a separate slab, which could bring much-needed relief to single-income families. Joint filing may also help couples make better use of tax exemptions on expenses such as home loan interest and medical insurance. However, this option may not suit everyone. For couples where both spouses earn high incomes, combining earnings could push them into a higher tax slab or surcharge bracket, making joint filing less tax-efficient in some cases.
Union Finance Minister Nirmala Sitharaman will present the Union Budget 2026–27 on Sunday, February 1. Businesses and industry leaders, along with the broader economy, are keenly watching the announcements, hoping for measures that can shield India from the impact of US tariffs and other global economic uncertainties.
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