Will the interest amount be taxable if I transfer money to spouse account and invest in FDs

Yes, you can transfer any amount to your wife’s account and invest in fixed deposits etc. in her name.

However, showing the transferred amount as gift to your wife would be better as it will be tax free for both. But, if you do not gift her the transferred amount, then the interest income received from the fixed deposits would be clubbed with that of your total income.

With regards to interest on fixed deposits, the tax would depend on her total earning during the financial year. In case the interest amount during the financial year is above the threshold limit, then she will have to pay taxes according to the tax slab she is falling into during that financial yaer. If it is less than the threshold limit, then no tax would be payable.