Don't forget the clubbing trap when gifting to spouse

AS MORE INDIAN households become dual-income families and financial planning increasingly becomes a shared responsibility, many couples are exploring ways to optimise their tax outgo.

- NEERAJ AGARWALA

From investing in a spouse's name and gifting funds to splitting ownership of assets, several strategies are often discussed as ways to reduce a family's overall tax burden.

However, tax planning for couples is an area where old practices are now being challenged with automated data scrutiny. While certain arrangements can help achieve financial goals efficiently, others may fail to deliver the expected benefits due to the clubbing provisions.

The clubbing trap