In other words: a married couple could choose what makes financial sense for them each year — file individually, or jointly.
Currently, under the Indian tax system, every individual — married or not — is taxed separately. Each spouse must file their own income tax return, even if they have shared income or joint expenses.
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What happens under new proposal?
According to a TOI report, the following outcomes would be the result if a couple opts to file a single consolidated Income tax return (ITR) under the joint-filing option:
Under the proposal, tax slabs for joint filers could be redesigned. One illustrative model suggests zero tax on combined income up to ₹6 lakh, a 5% rate for income between ₹6 lakh and ₹14 lakh, with higher slabs applying progressively beyond that.
Crucially, the joint filing system would be optional. Couples would be free to opt for joint taxation only if it offers a tax advantage; otherwise, they could continue filing separate returns, preserving flexibility under the existing framework.
Standard deductions for salaried taxpayers, along with exemptions and surcharge thresholds, may also be recalibrated. This could include a higher surcharge threshold and allowing separate standard deductions for each spouse if both are salaried.
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What could this mean for Indian households — a few scenarios
| Household type | Possible benefits under joint taxation |
| Single-earner couple (spouse unemployed / homemaker) | Lower tax liability — combined exemption could reduce the overall tax burden; simpler ITR filing and compliance. |
| Dual-earner couple with modest incomes | May benefit from a higher basic exemption and standard deductions; could still pay less tax than filing two separate returns, depending on slab thresholds. |
| High-income dual-earner couple | Limited benefit in many cases, as combined income may push the household into a higher tax slab; requires careful evaluation. |
| Families with children, home loan, medical expenses | Joint filing may allow better optimization of deductions (such as standard deduction, Sections 80C and 80D, and housing-related benefits) if structured efficiently. |
Source- The Times of India
(with TOI inputs)
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