What is a Hindu Undivided Family (HUF)?
A Hindu Undivided Family (HUF) is a legal entity under Indian tax laws. It helps families save taxes by pooling their assets under one umbrella. A HUF has its own PAN card and files a separate tax return.
Did You Know? Some HUFs in India have existed for over 100 years, passing tax benefits through generations!
Tax Benefits of a HUF
HUFs enjoy several tax benefits that reduce the overall tax burden.
How to Create a HUF
- Draft a HUF deed mentioning family members and Karta.
- Apply for a separate PAN card for the HUF.
- Open a bank account in the HUF’s name.
- Transfer assets or invest under the HUF for tax benefits.
Who Should Consider a HUF?
- Families with rental income.
- Business owners wanting to split profits.
- Individuals in higher tax slabs.
- Families with ancestral property.
A HUF is an excellent way to save taxes and manage wealth efficiently. If you qualify, forming a HUF can be a game-changer for your family’s financial future!
