HUF i.e. Hindu Undivided Family is treated as a different person under Income Tax. HUF is a family which consists of persons having a common ancestor, their wives and unmarried daughters. A HUF is created automatically in a Hindu Family and cannot be created by a contract. Jain and Sikh families can be treated as HUF under the Income Tax Act.
You and your spouse can create a HUF. However, to be recognized as HUF you need to have a HUF deed. This deed can be used to apply for the PAN of the HUF. Your children will automatically become a part of this HUF.
The head of the HUF is called the Karta. A Karta usually is the senior most male member of the Family.
HUF is treated as a separate entity under the income tax act and is required to file an ITR if the HUF's income is more than the basic exemption limit.