While the relationship between husband and wife is primarily emotional, it can also be financially beneficial. Engaging in certain joint financial transactions can yield substantial tax savings. By following three key strategies, you and your wife can save up to Rs 7 lakh in income tax.
1. Education Loan in Your Wife’s Name
If your wife wishes to pursue further studies, taking an education loan in her name can be highly advantageous. You can claim tax exemption on the interest paid on this loan for up to eight years, as per Section 80E of the Income Tax Act. Ensure that the loan is taken from a recognised bank or government institution.
2. Investing in the Stock Market
By making long-term investments in the stock market under your wife’s name, you can benefit from tax exemptions on capital gains up to Rs 1 lakh. This is particularly effective if your wife’s income is low or if she is a homemaker. Transferring some money to her for investment purposes can maximise your family’s overall tax savings.
3. Joint Home Loan
Couples often plan to buy a house together. By taking a joint home loan and registering the property in both names, you can double the tax benefits. Both partners can claim up to Rs 1.5 lakh each on the principal amount under Section 80C, totaling Rs 3 lakh. Additionally, under Section 24, both can claim up to Rs 2 lakh each on the interest paid, bringing the total potential tax benefit to Rs 7 lakh. The actual savings will depend on the amount of the home loan.
By strategically managing joint financial transactions, couples can not only achieve their financial goals but also significantly reduce their tax burden.
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