Free Online Tool

HUF Tax Calculator with the Honest 87A Rebate Check

See whether forming a Hindu Undivided Family actually cuts your family tax, or quietly raises it. Unlike other tools, this one applies the rule they hide: an HUF gets no Section 87A rebate, so a split can backfire under the new regime.

No-HUF vs split, side by side HUF gets no 87A rebate Old and new regime Backfire warning Separate LTCG exemption PDF and WhatsApp share

Two-Return Tax Comparison With the Rebate Rule Applied

Enter the income you would keep and the genuine HUF income you would route to the family entity, to see if the split really saves tax.

Your salary, personal income, etc. Salary cannot be moved to an HUF.
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Rent from ancestral property, HUF business, gifts to the HUF. Not salary.
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Enter your income figures and tap Calculate.

What an HUF Is and How It Saves Tax

A Hindu Undivided Family, or HUF, is one of the oldest and most useful structures in Indian tax law. It is recognised as a separate person under the Income Tax Act, distinct from every individual member of the family, which means it gets its own PAN, its own bank account, and, crucially, its own tax return with its own basic exemption and its own slab rates. Hindu, Jain, Sikh and Buddhist families can form one, and it consists of persons lineally descended from a common ancestor, along with their spouses and unmarried daughters, headed by a karta, usually the senior-most member.

The tax appeal is simple and legitimate: because the HUF is a separate taxpayer, a family can split its income between the individual members and the HUF, so that the same total income is spread across two sets of exemptions and slabs rather than piled onto one. Income that would otherwise sit at a member’s top marginal rate can instead be earned by the HUF and taxed in its hands, starting again from its basic exemption and climbing its own slabs. For a family in the highest bracket with genuine HUF income, this can save a meaningful amount of tax every year, entirely within the law.

Under the old tax regime, the advantage is larger, because the HUF also gets its own separate deduction limits, on top of every member’s. It has its own Section 80C limit of one and a half lakh, its own Section 80D for health insurance, its own Section 24(b) for home loan interest, and so on. So a family can effectively double up on these deductions, claiming them once on the individual return and again on the HUF return, provided the HUF genuinely incurs the qualifying investments and expenses from its own funds. This is where much of the real HUF saving comes from for families with substantial income to route.

But there is a catch that almost every HUF calculator ignores, and it can turn the whole exercise negative. The HUF does not get the Section 87A rebate, the rebate that makes income up to twelve lakh completely tax-free for an individual under the new regime. This single omission means that in many cases, especially at moderate incomes under the new regime, splitting income to an HUF creates tax where the individual would have paid none. This tool applies that rule honestly, so it tells you not just how much an HUF could save, but whether it would help at all, or quietly cost you more.

The Rebate Trap, and When an HUF Actually Helps

Here is the rule that changes everything, and that most HUF calculators quietly skip: the Section 87A rebate is available only to resident individuals, not to an HUF. Under the new tax regime, an individual with taxable income up to twelve lakh pays zero tax, because the rebate wipes out the liability. An HUF with the same twelve lakh of income gets no such rebate; it pays tax from the first rupee above its four lakh basic exemption, which works out to about sixty-two thousand rupees. So an income that is completely tax-free in an individual’s hands becomes taxable the moment you route it through an HUF.

The consequence is stark and counterintuitive: for many families, especially at moderate income levels under the new regime, forming an HUF and splitting income into it increases the family’s total tax rather than reducing it. If your individual income is already within the twelve lakh rebate zone, moving part of it to an HUF simply exposes that part to tax it would not otherwise have faced. This is the single most important thing to check before forming an HUF, and it is exactly the check this tool performs: it compares your tax with all income in your own hands against your tax with the income split, and tells you plainly if the split would backfire.

So when does an HUF genuinely help? Primarily for high-income families where both the individual and the HUF have income comfortably above the rebate threshold, so the rebate is irrelevant and the benefit comes purely from using the HUF’s separate lower slabs and, under the old regime, its separate deductions. A family in the thirty per cent bracket with six to ten lakh of genuine HUF income can save one to two lakh a year from the structure alone, before deductions, and more with them. For such families the HUF is a powerful, legitimate tool. For a purely salaried family with modest income and no ancestral assets, the benefit is often minimal or negative, and the compliance may not be worth it.

Two further conditions decide whether an HUF is viable at all. First, the income must genuinely belong to the HUF: it can come from ancestral property, from assets received on a family partition, from gifts made to the HUF by non-members, or from a business run by the HUF, but it cannot be your salary, which is personal and cannot be shifted. Second, you cannot simply gift your own money to your HUF to generate income there, because Section 64(2) clubs the income from such self-gifted assets back to you, defeating the purpose. A workable HUF needs a real source of family income, which is why it suits families with inherited wealth, property or a family enterprise far more than a single salaried earner.

There is, however, one clean bonus available to any family that holds equity: the individual and the HUF each get a separate annual exemption of one and a quarter lakh on long-term equity capital gains, so together they can shelter two and a half lakh of gains a year tax-free, and this benefit works even under the new regime with no deductions lost.

How the Calculation Works

The tool runs the honest HUF comparison in four steps.

Step one: the no-HUF baseline

It first computes your tax if all the income, both your personal income and the income you might route to an HUF, is taxed in your own hands under your chosen regime, applying the Section 87A rebate you are entitled to as an individual and, under the old regime, your personal deductions. This is your baseline: what you pay with no HUF at all.

Step two: the split scenario

It then computes the two returns under an HUF split: your individual return on just your personal income, and the HUF’s return on the income routed to it. Both use the same regime and the same slab rates, but here is the crucial difference the tool gets right: the HUF return gets no Section 87A rebate and no standard deduction, only its own basic exemption and, under the old regime, its own separate deductions.

Step three: the honest verdict

It compares the total tax under the split, your individual tax plus the HUF’s tax, against the no-HUF baseline. If the split total is lower, the HUF saves your family money, and it shows how much. If the split total is higher, which happens surprisingly often under the new regime because of the lost rebate, it warns you plainly that the HUF would backfire and cost you more, so you do not form one on the strength of a misleading calculation.

Step four: the context and caveats

Finally it explains the result in plain language, notes whether the benefit comes from the separate slabs or the separate deductions, and surfaces the conditions that decide whether an HUF is actually workable for you: that the income must genuinely be the HUF’s, that self-gifts are clubbed back under Section 64(2), that the new regime strips the HUF of all deductions, and the separate equity LTCG exemption both entities enjoy. The aim is a decision, not just a number.

HUF Tax Rules for 2026

These are the figures and rules the tool uses, for AY 2026-27. Verify at the income tax site or with a chartered accountant.

What the HUF gets, and does not

FeatureHUF position
Basic exemption4 lakh (new regime), 2.5 lakh (old)
Slab ratesSame as an individual
Section 87A rebateNOT available to an HUF
Standard deductionNot available (no salary income)
Senior-citizen slabsNot available
80C, 80D, 24(b)Own separate limits, old regime only

The 87A rebate difference at 12 lakh (new regime)

TaxpayerTax on 12 lakh
Resident individualNil (87A rebate)
HUFAbout 62,400 (no rebate)

When an HUF is worth it

SituationVerdict
High income, genuine HUF incomeYes, can save 1 to 3 lakh a year
Ancestral property or family businessYes, a real income source to route
Purely salaried, modest incomeOften minimal or negative benefit
Income within the 12 lakh rebate zoneSplitting often backfires

Three Worked Examples From Real Families

Here are three families using the tool to decide on an HUF honestly.

The Sharmas save with ancestral rent in Mumbai

The Sharmas in Mumbai own ancestral property that earns about ten lakh a year in rent, and Mr Sharma is a high earner in the thirty per cent bracket. On the tool, routing the rental income through an HUF rather than adding it to Mr Sharma’s already high income was clearly beneficial: the HUF started from its own basic exemption and lower slabs, and under the old regime claimed its own separate 80C and other deductions. The family saved well over a lakh a year, entirely legally, because the income genuinely belonged to the HUF, it was ancestral, not salary, and there was a real source to route. For the Sharmas, the HUF was exactly the tool it is designed to be.

Ravi discovers the split would backfire in Pune

Ravi, a salaried professional in Pune on the new regime, earns twelve lakh a year and had read that an HUF saves tax. He assumed splitting some income to an HUF would help. On the tool, the truth was the opposite. His twelve lakh, in his own hands under the new regime, attracts zero tax thanks to the Section 87A rebate. But routing part of it to an HUF, which gets no rebate, would create a tax bill where there was none, costing his family more. The tool flagged the backfire explicitly and explained the rebate rule. Ravi, whose income was salary anyway and could not legally be shifted, wisely dropped the idea and avoided a costly mistake that a rosier calculator would have encouraged.

The Guptas use the family business and LTCG in Chennai

The Guptas in Chennai run a small family business and also hold equity investments. On the tool, they modelled routing the business income through an HUF, and because their total income was high and well above the rebate zone, the HUF’s separate slabs saved them a substantial amount, with further savings from its own old-regime deductions. Separately, the tool reminded them that their individual and HUF demat accounts each get a one and a quarter lakh annual LTCG exemption, letting the family shelter two and a half lakh of long-term equity gains a year tax-free, a bonus that works even under the new regime. The Guptas set up the HUF properly, with genuine business income and its own investments, and captured both benefits.

Six Tips for HUF Tax Planning

Check the 87A rebate first

An HUF gets no rebate. If your income is within the 12 lakh new-regime rebate zone, splitting to an HUF often creates tax. Check before forming one.

Only route genuine HUF income

Ancestral property, family business, or gifts to the HUF qualify. Your salary does not and cannot be shifted. The income must really be the HUF’s.

Beware Section 64(2) clubbing

Gift your own money to your HUF and the income from it is clubbed back to you. Self-funding the HUF defeats the purpose; use genuine family assets.

The old regime gives more

Under the old regime the HUF gets its own 80C, 80D and 24(b) on top of yours. Under the new regime it gets no deductions, only its slabs.

Use the separate LTCG exemption

Your demat and the HUF’s each get a 1.25 lakh equity LTCG exemption, sheltering 2.5 lakh of gains a year. This works even in the new regime.

Weigh the compliance cost

An HUF needs a separate PAN, bank account and annual return. For a small saving it may not be worth the effort; for a large one it clearly is.

Quick Reference: HUF Tax

QuestionAnswer
Is an HUF a separate taxpayer?Yes, own PAN, exemption and slabs
Does an HUF get the 87A rebate?No, only resident individuals do
What is the HUF basic exemption?4 lakh new regime, 2.5 lakh old
Can I route my salary to an HUF?No, only genuine HUF income
When does the split backfire?When your income is in the rebate zone
Any benefit in the new regime?Separate slabs and LTCG exemption only

Frequently Asked Questions on HUF Tax

What is a Hindu Undivided Family (HUF)?
A Hindu Undivided Family, or HUF, is a separate legal entity recognised under the Income Tax Act as a distinct person, separate from the individual members of the family. It is formed by a Hindu, Jain, Sikh or Buddhist family and consists of persons lineally descended from a common ancestor, together with their spouses and unmarried daughters. The senior-most member, called the karta, manages it, and the other members are coparceners. An HUF comes into existence automatically when there is a joint family with ancestral property or a common ancestor, but to be assessed as a taxpayer it needs its own PAN, a bank account, and at least two coparceners; a single person cannot form an HUF. Because it is a separate taxpayer, it files its own income tax return and gets its own basic exemption, its own slab rates, and, under the old regime, its own deduction limits, all independent of the individual members. This separateness is what allows a family to use an HUF for legitimate tax planning.
How does an HUF save tax?
An HUF saves tax by acting as a second, separate taxpayer, so that a family’s income can be split across two sets of exemptions and slabs instead of being taxed entirely in one member’s hands at their top marginal rate. Income that genuinely belongs to the HUF, such as rent from ancestral property or profits from a family business, is taxed in the HUF’s return, starting again from its own basic exemption and climbing its own lower slabs, rather than being added to a high-earning member’s income where it would attract the top rate. Under the old regime, the saving is greater still, because the HUF also gets its own separate Section 80C, 80D and 24(b) deductions, on top of every member’s, effectively doubling the family’s deduction capacity. For a high-income family with genuine HUF income, this can save one to three lakh a year. However, the saving depends critically on the income being real HUF income and on the Section 87A rebate rule, which can make splitting counterproductive at moderate incomes.
Does an HUF get the Section 87A rebate?
No, and this is the single most important and most overlooked point in HUF tax planning. The Section 87A rebate, which makes income up to twelve lakh completely tax-free under the new regime and up to five lakh under the old regime, is available only to resident individuals. An HUF is a separate category of taxpayer and does not qualify for it. The practical consequence is dramatic: an individual with twelve lakh of taxable income under the new regime pays zero tax because of the rebate, but an HUF with the same twelve lakh pays about sixty-two thousand rupees, since it is taxed from the first rupee above its basic exemption with no rebate to wipe the liability out. This means that routing income from your individual return, where the rebate protects it, to an HUF, where it does not, can create tax that would not otherwise exist. Most HUF calculators ignore this and overstate the benefit; this tool applies the rule correctly, so it can warn you when an HUF would actually increase your family’s tax.
When does forming an HUF backfire?
Forming an HUF backfires, meaning it increases your family’s total tax rather than reducing it, most commonly when your income is within the Section 87A rebate zone under the new regime. Because an individual pays zero tax on income up to twelve lakh under the new regime thanks to the rebate, but an HUF gets no rebate and pays from the first rupee above its exemption, moving income from your rebate-protected individual return into an HUF simply exposes that income to tax it would not otherwise have faced. So for a salaried person earning around twelve lakh or less under the new regime, splitting income to an HUF is usually a mistake. The HUF only helps when both the individual and the HUF have income comfortably above the rebate threshold, so the rebate is irrelevant and the benefit comes from the HUF’s separate lower slabs and old-regime deductions. This tool compares your tax with and without the HUF split and tells you explicitly when it would backfire, which is precisely the check most calculators fail to make.
What is the basic exemption limit for an HUF?
For the financial year 2025-26, an HUF gets a basic exemption limit of four lakh rupees under the new tax regime, which is the default, and two and a half lakh rupees under the old tax regime. These are the same limits that apply to an individual below sixty, since the HUF is taxed at the same slab rates as an individual. However, unlike an individual, an HUF does not get the higher exemption limits available to senior and super-senior citizens, because those age-based benefits apply only to individuals; an HUF has no age. Nor does it get the Section 87A rebate that effectively raises an individual’s tax-free income much higher. So while the headline exemption is the same as an individual’s, the HUF’s effective tax-free income is lower, because it lacks the rebate. The HUF’s own basic exemption is genuinely useful for tax planning, though, because it is separate from and additional to every family member’s exemption, giving the family a second tax-free slab for genuine HUF income.
What income can be routed to an HUF?
Only income that genuinely belongs to the HUF can be taxed in its hands; you cannot simply move any income you like to it. Legitimate sources include income from ancestral property, such as rent from a house inherited by the family; income from assets received on a partition of a larger HUF; income from a business run by the HUF using its own funds; and income from investments made with the HUF’s own money, such as interest, dividends and capital gains. Gifts made to the HUF by non-members can also form part of its corpus, though gifts exceeding fifty thousand rupees a year from non-relatives are taxable in the HUF’s hands under Section 56. What cannot be routed to an HUF is salary income, which is personal to the individual who earns it and cannot be shifted, and income from assets you gift to your own HUF, because that income is clubbed back to you under Section 64(2). So an HUF suits families with real, separable sources of family income far more than a single salaried earner with nothing but their pay.
What is Section 64(2) clubbing?
Section 64(2) is an anti-avoidance rule that prevents you from artificially reducing your tax by gifting your own money or assets to your HUF. It provides that when a member transfers their personal property to the HUF for less than adequate consideration, in other words gifts it, the income arising from that property continues to be taxed in the hands of the member who transferred it, not the HUF. So if you were to gift, say, ten lakh of your own savings to your HUF and the HUF invested it and earned interest, that interest would be clubbed back to your personal income and taxed at your rate, defeating the entire purpose of the exercise. This is why you cannot simply self-fund an HUF to create tax-free income in it. A workable HUF needs a genuine, independent source of income, ancestral assets, a family business, or gifts from others, rather than money you have shifted from your own pocket. Understanding this clubbing rule is essential, because a poorly planned HUF built on self-gifts provides no tax benefit at all and merely adds compliance.
Does an HUF get deductions like 80C?
Under the old tax regime, yes, and this is a major part of the HUF’s appeal. An HUF gets its own Section 80C deduction of up to one and a half lakh, its own Section 80D for health insurance premiums, its own Section 24(b) for home loan interest of up to two lakh, its own Section 80G for donations, and other deductions, all entirely separate from and additional to the deductions each individual member claims on their own return. So a family can, in effect, claim these deductions twice, once on the individual return and once on the HUF return, provided the HUF genuinely makes the qualifying investments and payments from its own funds. This effectively doubles the family’s deduction capacity and is where much of the HUF’s tax saving comes from under the old regime. Under the new tax regime, however, the HUF gets no deductions at all, just as individuals do not, so its only advantages there are its separate basic exemption and slabs and the separate equity LTCG exemption. This is why the regime choice matters a great deal for HUF planning.
Should an HUF choose the old or new tax regime?
It depends on whether the HUF has enough deductions to justify the old regime, exactly as for an individual. Under the new regime, which is the default, the HUF gets lower slab rates and a four lakh basic exemption but no deductions whatsoever. Under the old regime, it has a lower two and a half lakh exemption and higher slab rates, but it can claim its own separate 80C, 80D, 24(b) and other deductions. So if the HUF has substantial deductible investments and expenses of its own, home loan interest on an HUF property, insurance, 80C investments, the old regime often produces a lower tax; if it has little to deduct, the new regime’s lower rates usually win. The HUF must actively opt for the old regime in its return, since the new regime applies by default. It is worth computing the HUF’s tax under both regimes each year, as this tool lets you do, because the right choice can change with the HUF’s income and deduction profile, just as it can for an individual.
How do I form an HUF?
An HUF comes into existence automatically the moment a Hindu family has joint ancestral property or a common ancestor, so in a legal sense you do not create it so much as formalise it for tax purposes. To make it a functioning taxpayer, the usual steps are: prepare an HUF deed, a declaration on stamp paper naming the karta and the coparceners and stating that the HUF exists; apply for a separate PAN card in the HUF’s name; open a bank account in the HUF’s name; and give the HUF a corpus, its initial capital, which should come from a genuine source such as ancestral assets, a partition, or gifts from non-members, not from the karta’s own funds, to avoid clubbing. Once it has a PAN, a bank account and income, the HUF files its own annual income tax return, using ITR-2 if it has no business income or ITR-3 if it does, never ITR-1. The formation is not difficult, but running an HUF properly requires keeping its finances genuinely separate from the members’ and maintaining records, so it is worth doing only when the tax saving justifies the ongoing compliance.
How much tax can an HUF actually save?
For a family with genuine HUF income and a high-earning member, an HUF can save a substantial amount, often one to three lakh rupees a year, and sometimes more when old-regime deductions are fully used. The saving comes from two sources: routing income to the HUF’s separate lower slabs instead of a member’s top marginal rate, and, under the old regime, claiming the HUF’s separate deductions on top of the members’. A family in the thirty per cent bracket with six to ten lakh of genuine HUF income can save one to two lakh from the slab benefit alone, before deductions. However, the saving can also be zero or negative. For a purely salaried family with modest income and no ancestral assets or family business, there is little genuine income to route, and if the individual’s income is within the rebate zone, splitting can actually increase tax. So the honest answer is that the HUF saving ranges from very worthwhile to counterproductive depending entirely on your income level, its source, and your regime, which is exactly what this tool computes for your specific situation rather than assuming a rosy figure.
What is the separate LTCG exemption for an HUF?
When an HUF holds equity shares or equity mutual funds in its own demat account, it gets its own separate annual exemption of one and a quarter lakh on long-term capital gains from equity, under Section 112A, completely independent of the same exemption available to each individual member. This means a family where both the individual and the HUF hold equity investments can together realise two and a half lakh of long-term equity gains in a year without paying any capital gains tax, one and a quarter lakh sheltered on the individual’s return and another one and a quarter lakh on the HUF’s. Since long-term equity gains above the exemption are taxed at twelve and a half per cent, this extra one and a quarter lakh of sheltered gains is worth about fifteen thousand six hundred rupees of tax saved a year, and doubling the family’s tax-free gains can be worth more over time as the exemptions are used each year. Importantly, this benefit works even under the new tax regime, since it is a capital gains exemption rather than a deduction, so it is one HUF advantage that does not depend on choosing the old regime.
Can a salaried person benefit from an HUF?
A salaried person cannot route their salary to an HUF, because salary is personal income earned by the individual and cannot be shifted, so the core income-splitting benefit does not apply to their salary. However, a salaried person can still benefit from an HUF if the family has other, genuine HUF income, for example rent from ancestral property, income from a family business, or returns on investments made with the HUF’s own corpus from ancestral or gifted funds. In that case, the salaried person’s own salary stays on their individual return, while the separate family income is taxed in the HUF, and the family as a whole saves. A salaried person with no ancestral assets, no family business, and nothing but their pay has little to gain from an HUF, and if their income is within the rebate zone under the new regime, forming one could even backfire. So the answer is that a salaried person benefits from an HUF only to the extent the family has separable, non-salary income to route through it, not from their salary itself.
Which ITR form does an HUF file?
An HUF files ITR-2 if it does not have income from a business or profession, that is, if its income is from house property, capital gains, and other sources like interest and dividends. It files ITR-3 if it does have income from a business or profession, which is common where the HUF runs a family enterprise. An HUF can never file ITR-1, the simple form, because ITR-1 is only for resident individuals with straightforward income, not for HUFs. The due date for filing is usually the thirty-first of July for HUFs whose accounts do not require audit, and later, typically the thirty-first of October, for those whose accounts must be audited under Section 44AB, which applies when business turnover or professional receipts cross the prescribed thresholds. The HUF files its return using its own PAN, entirely separately from the members’ returns. Because the HUF is a distinct taxpayer, its filing, record-keeping and compliance are additional to the members’ own, which is part of the ongoing cost of running an HUF and a factor to weigh against the tax saving.
Are the results from this tool accurate?
Yes, the calculations use the current financial year’s slab rates and the correct rules for HUF taxation, and are accurate for the inputs you provide. Crucially, the tool applies the rule most HUF calculators get wrong: it denies the HUF the Section 87A rebate and the standard deduction, so the split scenario reflects the HUF’s real tax position, not an overstated one. It computes your tax with all income in your own hands, your tax with the income split between you and the HUF, and the genuine net saving or loss, under both the old and new regimes with the appropriate deductions. What the tool assumes is that the income you enter as HUF income genuinely qualifies to be taxed in the HUF, which is a legal question you must satisfy, since salary cannot be routed and self-gifts are clubbed. It also does not model every possible deduction or the compliance cost of running an HUF. So treat the result as an accurate comparison of the tax under each structure, and confirm both the eligibility of the income and the final plan with a chartered accountant before forming an HUF, as this is a decision with lasting legal and compliance consequences.
What happens to an HUF on partition?
An HUF can be dissolved through a partition, in which its assets are divided among the coparceners, and this is the only recognised way to bring an HUF to an end for tax purposes. Under Section 171 of the Income Tax Act, only a total partition, where the entire HUF property is divided and the HUF ceases to exist, is recognised; a partial partition, dividing only some assets or among only some members, has no tax effect and the HUF continues to be assessed as if no partition happened. On a total partition, the assets are distributed among the coparceners, who then hold their shares individually, and the HUF’s PAN becomes inactive once the partition is accepted by the assessing officer. Partition can be a useful planning step, for instance to distribute wealth to the next generation or to wind up an HUF that no longer serves a purpose, but it must be done properly and documented, and the tax authorities scrutinise claimed partitions carefully. Because partition permanently unwinds the structure and has legal and succession implications beyond tax, it should be planned with a chartered accountant and, where property is involved, legal advice, rather than treated as a casual step.

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Disclaimer and editorial transparency

This HUF tax calculator is a free, independent tool from CalcWise.Finance. It compares your income tax with all income taxed in your own hands against the tax under an HUF split, computing the individual return with the Section 87A rebate you are entitled to, and the HUF return correctly without the rebate, without the standard deduction, and, under the new regime, without any deductions. It uses the current financial year’s slab rates, and under the old regime applies the separate 80C limits for both you and the HUF, to show the genuine net saving or, where relevant, the loss from splitting.

The calculations are accurate for the inputs you provide, but the results depend on the income you enter as HUF income genuinely qualifying to be taxed in the HUF, which is a legal matter: salary cannot be routed to an HUF, and income from assets you gift to your own HUF is clubbed back to you under Section 64(2). The tool does not model every deduction, the compliance cost of running an HUF, or your full personal tax situation.

An HUF is a lasting legal structure with ongoing filing and record-keeping obligations, and forming one is a decision with consequences beyond a single year’s tax. The tool is for informational and educational use, not tax advice. Confirm the eligibility of the income and the overall plan with a qualified chartered accountant before forming an HUF. Verify current rules at incometax.gov.in. Nothing here is financial or tax advice.