Budget 2026: Could married couples get some tax relief?
16 Jan 2026

Ahead of the Union Budget, married taxpayers in India could get some relief.

The Finance Ministry is looking at the idea of optional joint taxation, a system where couples can file their tax returns together.

This would particularly benefit single-income families by reducing their overall tax burden.

The proposal was made by the Institute of Chartered Accountants of India (ICAI), based on similar models in the US and Germany.

Current tax system and its limitations
Existing framework

Under the current tax system, every individual is taxed separately, irrespective of their marital status.

Each spouse gets separate exemptions, slabs, and deductions.

This means that single-income families can't fully utilize the other spouse's exemptions, which increases their overall tax burden.

The proposed joint taxation system would address this issue by allowing couples to combine their incomes and file a single tax return together.

Benefits of joint taxation for married couples
Tax relief

The proposed joint taxation system would combine the total income of both spouses and tax it under a separate slab. This could particularly benefit families with only one income earner.

It would also allow couples to better adjust exemptions for home loan interest and medical insurance.

The proposal is to introduce this system as an option in Budget 2026, giving taxpayers the choice between sticking with the current personal tax system or opting for joint taxation.

Potential changes in tax slabs under joint taxation
Tax adjustments

Under the proposed joint taxation system, the basic exemption limit and tax slabs could be increased proportionally.

For example, if an individual currently gets an exemption of ₹3 lakh, this limit could be doubled or even more under joint filing. This would directly benefit middle-class families.

The proposal also suggests increasing the surcharge threshold from ₹50 lakh to ₹75 lakh for income above which a surcharge is levied.

Joint taxation: A step toward modernizing India's tax laws
Modernization move

The joint taxation system is similar to those in the US and Germany, where married couples can file joint tax returns as one economic unit.

This could be a major step toward modernizing India's tax laws and making them simpler.

However, it's important to note that if both spouses earn an income, they would continue to get separate standard deductions under this proposal.