Income Tax For Housewives In India: How Does It Work?

Filing ITR is important for everyone, including housewives. Even if they do not possess any direct income, housewives can have 'Income from other sources' such as interest from fixed deposits, rent from a property owned and others. If the income from such sources exceeds the limit prescribed by the Indian government, a housewife would need to file her ITR. 

This article will discuss the different aspects of income tax for housewives, such as eligibility, deductions and income sources.

Budget 2025 Updates

The new Income Tax Bill has been tabled by the Honorable Finance Minister in the Lok Sabha. It aims to simplification and better presentation of the provisions.

As per the budget 2025, the income up to Rs. 12,00,000 will have zero tax liability for the FY 2025-26 (AY 2026-27) under the new tax regime. Here's how:

The revised tax slabs under the new regime for FY 2025-26 (AY 2026-27) are as follows:

Annual Income Tax Slabs	income Tax Rates
Upto Rs. 4,00,000	NIL
Rs. 4,00,001 - Rs. 8,00,000	5%
Rs. 8,00,001 - Rs. 12,00,000	10%
Rs. 12,00,001 - Rs. 16,00,000	15%
Rs. 16,00,001 - Rs. 20,00,000	20%
Rs. 20,00,001 - Rs. 24,00,000	25%
Above Rs. 24,00,000	30%

With the revised tax structure, individuals earning up to Rs. 12,00,000 will have no tax liability due to the increased rebate of Rs. 60,000. For salaried individuals, the tax liability will be zero for incomes up to Rs. 12,75,000, due to the Rs. 75,000 standard deduction.

Note:

• The marginal relief on rebate is still applicable. 
• The rebate is not available for income that is taxed at special rates (e.g., capital gains under section 112A).

Do Housewives Need To Pay Income Tax?

As per the old tax regime applicable for FY 2023-24, a housewife (aged below 60 ) who earns less than Rs.2.5 lakh will not be subject to taxation. If the housewife falls in the senior category, i.e., 60 years or super senior citizen category, i.e., 80 years and above, the minimum exemption limit has been increased to Rs.3 lakh and Rs.5 lakh respectively.

In the new tax regime, the basic exemption limit will be Rs.300,000, up to which no tax liability exists, regardless of age.

Housewives will only be liable to pay taxes if the total income from different sources exceeds the basic exemption limit.

Income Tax Slab For Women (New Tax  Regime)

Income Tax Slab For Women Below 60 years (Old Tax Regime)

Income Tax Slab For Women Between 60 and 80 years (Old Tax Regime)

Income Tax Slab For Women Above 80 Years (Old Tax Regime)

After knowing the eligibility and tax applicable to the income, a question comes to mind, how to file an income tax return for a housewife in India? 

To file income tax returns, you need only register on the income tax department's e-filing portal and get a valid User ID and Password. 

Once registered, you can submit your income tax return online. The type of return to be submitted depends on the source of income, i.e., whether the income is from capital gains, multiple house properties, or other sources. 

Income Sources For Housewives

Housewives possess their income from different sources, as they do not fall under the category of salaried or self-employed individuals. Some of the key income sources for housewives are as follows: 

• Interest from fixed deposits

Interest generated from a fixed deposit is taxable, but it solely depends on the amount generated. If the interest the wife earns is beyond the exempted limit, it is considered her income.

• Money received from husband and invested in wife’s name

If the husband invests his income under the name of his wife, then it gets treated as income of the husband. Thus, the husband would be liable to pay the taxes. However, if the wife earns any money from such income, it will get taxed under the wife’s name.

• Gifts

Gifts from specific relatives are not taxed under the IT Act 1961, irrespective of the amount. Any gifts received from other individuals exceeding the value of Rs.50,000 will be considered income, and the housewife will have to pay taxes accordingly.

• Sales of Investments

If the wife sells investments and the capital gains exceed the basic exemption limit, then Income Tax Return must be filed.

Tax Deductions And Exemptions For Housewives

The Income Tax Act provides individuals with different exemptions and deductions to reduce taxable income. Income tax deductions and exemptions applicable to housewives are discussed below. 

• Medical Insurance

A tax deduction can be claimed by housewives u/s 80D on medical insurance paid for themselves or dependents for each financial year.

• Donations

Under Section 80G, a housewife is eligible for a tax deduction if donations are made to any distinct charitable organisation.

• Interest

Under the Income-tax Act., interest income of upto Rs.10,000 is exempt u/s 80TTA for individuals below 60 years of age and up to Rs.50,000 is exempt for senior citizens u/s 80TTB.

Calculating Taxable Income

Are you a homemaker wondering how your taxes get calculated? It is quite simple. Taxable income is the sum of all your earnings minus any allowed deductions and exemptions. As a housewife, you can take advantage of deductions like investing in specified savings schemes such as the Public Provident Fund (PPF) and National Saving Certificate (NSC).

Final Word

Overall, it can be said that since direct income is not available, housewives are typically exempt from paying taxes. Moreover, income from other sources will only be subject to taxation if it exceeds the exemption limit. 

The ITR form for housewives is not different from that of salaried individuals. So, it is suggested that even if you do not possess any income, filing ITR can be helpful in cases of a joint loan application, address proof and others.

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Income Tax Slab For Women For FY 2023-24