Budget 2026: Big Tax Relief For Married Couples? All About Joint Taxation

Ahead of the Union Budget 2026, married taxpayers in India may get relief. The Finance Ministry is considering optional joint taxation. If passed, it would allow couples to file combined tax returns, helping them save money, especially for single-income families.

The Institute of Chartered Accountants of India (ICAI) made the recommendation following the models in the USA and Germany, where married couples can file tax jointly.

The Current System

At present, every individual pays tax separately, regardless of marital status. Each spouse gets separate exemptions, slabs, and deductions. Single-income households cannot fully utilise the other spouse's exemptions, increasing tax burden.

What Is Joint Taxation?

Joint taxation means that married couples can combine their incomes and file a tax return together. The proposal is to introduce this in Budget 2026 as an optional system. That is, those who wish can remain under the existing personal tax system, while those who want can choose the joint taxation option. Both spouses will need to have a PAN.

Why Is Joint Taxation Necessary? Benefits

Under this system, the total income of the husband and wife will be combined and taxed under a separate slab. It could especially provide relief to families with only one income earner. Joint filing will also allow couples to better adjust exemptions for home loan interest and medical insurance.

Possible Changes In Tax Slabs

Under joint taxation, the basic exemption limit and tax slabs could be increased proportionally. For instance, if an individual currently gets an exemption of Rs 3 lakh, under joint filing, this limit could be doubled or even more. This would directly benefit middle-class families.

Relief On Surcharge

Currently, income above Rs 50 lakh attracts a surcharge. Experts suggest increasing the threshold to Rs 75 lakh. In joint taxation, surcharge limits could also be set proportionally, reducing tax pressure.

If both husband and wife earn an income, the proposal is that both should continue to get separate standard deductions.

Countries like the USA and Germany allow married couples to file joint tax returns, treating the family as one economic unit. India could adopt a similar system to simplify and modernize its tax laws.

When Is Budget 2026?

The Budget Session of Parliament is expected to begin on January 28 and continue until April 2. The Union Budget 2026-27 is scheduled to be presented on Sunday, February 1, in Parliament by Finance Minister Nirmala Sitharaman.