'If you're married and a Hindu...': Billionaire Nithin Kamath highlights a way to save taxes

‘If you’re married and a Hindu…’: Billionaire Nithin Kamath highlights a way to save taxes

Zerodha co-founder and CEO Nithin Kamath on Thursday highlighted the benefit of Hindu Undivided Family (HUF) — a unique legal and tax entity specific to Hindu families in India which allows citizens to save on taxes.

“If you’re married and a Hindu, you can use a HUF to plan and save your taxes. HUF is treated as a separate entity, so all these deductions will apply separately to HUF along with the individual deductions,” he wrote on X. “So, transferring any property yielding rental income to the HUF, opening a demat account in the HUF name, transferring money to the HUF bank account, accepting gifts, etc.”

The Zerodha boss also shared a video and a blog explaining how HUF can be used for planning and saving taxes.

The Hindu Undivided Family is treated as a “person” under section 2(31) of the Income-tax Act, 1961, for the purpose of assessment under the Act. HUF has its own Permanent Account Number (PAN) and files tax returns independent of members, as per a report in Business Standard. Even though Jain and Sikh families are not governed by the Hindu law, they can also form HUFs.

Responding to Nithin Kamath’s post X users, including other business leaders and former IAS officers, also spoke in favour of the HUF, calling it a “game changer” when it comes to saving taxes.

“Married Hindus, take note: HUF isn’t just a tax-saving strategy, it’s a game-changer. By leveraging its benefits, you can take control of your finances and secure a brighter future,” wrote Dazeinfo CEO Amit Misra.

Former IAS officer KBS Sidhu commented, “I have always suggested that any Hindu who marries, should create an HUF on the very same day. It is a common misimpression that a person needs to be blessed with a son to be able to form an HUF. Moreover, people following the religion of Sikhism, Jainism and Buddhism are also eligible for the benefit of HUF.”