Title: Interest in Tax

Question: I am a software engineer and earning good salary. At the same time I am paying quite substantial amount in income tax. I came to know that we can use the interest amount to pay income tax. Can I transfer my money to my wife’s fixed account and use the interest amount earned to pay my tax? With this I can save the tax levied on interest amount since my wife is housewife and not earning. If I do fixed deposit in my account, there will be taxable amount on interest earned. It would be helpful if you can clear my question on: can I transfer my money to my wife’s fixed account and use the interest amount earned to pay my tax?

Answer ID: 40819Posted on: Sep 1, 2020

Bismillah hir-Rahman nir-Rahim !

(Fatwa: 1352/851/L=1433) In the case mentioned above, you may transfer your amount in the account of your wife. Also you can use the interest money which is derived from the account to pay the tax. Note: It is allowable only to transfer in the account of wife but not in her fixed deposit account.