Current financial year is coming to an end and its a right time to discuss various Income Tax exemptions and deductions to minimize tax outflow. One such exemption is House Rent Allowance or more popularly known as HRA. HRA is a salary component received by an employee from the employer. HRA is included in salary so that employee can take care of cost towards renting an accommodation. HRA is exempted from Income Tax under section 10(13A) of the Income tax Act, 1961 and Rule 2 of Income Tax Rules. In this post, besides discussing basics of HRA we will also discuss some not so known facts about HRA for the benefit of readers.
Who can claim HRA Exemption?
Some of the basic condition to claim HRA are
(a) Employee should be staying in Rented Accommodation
(b) Paying Rent for the House
(c) Employee should not be co-owner of the House e.g. if Husband and Wife are joint owners of property and Husband is claiming 100% tax benefits on Home Loan. If wife is paying rent to Husband to claim HRA tax exemption then exemption is not allowed in such cases.
(d) HRA should be part of salary package
In this section, 3 most common queries are
1. I am staying with my parents, Can i pay Rent to my Parents?
Answer is Yes, It is very much permissible under Income Tax Act provided property is registered in the name of your parent/s. One of my reader Richa from indore asked me that her parents are staying in a rented accommodation and she is staying with her parents. Her parents are paying rent to landlord and she is paying rent to her parents, can she claim HRA exemptions. Answer is NO in this case because parents are not the owner of property. Secondly, your parents should declare rent received as Rental Income in their Income Tax Returns. If both these conditions are fulfilled, you can claim HRA exemption on rent paid to your parents.
2. My spouse own a property and i pay rent to him/her, Can i claim HRA exemption?
Answer is NO, You cannot pay rent to your spouse and claim Income Tax exemption. Some of my readers asked Why? Answer is very simple, as per Indian Legal System and institution of marriage / marriage act, you are supposed to stay with your spouse.
Last year, there was a landmark judgment by Ahmedabad Income Tax Appellate Tribunal wherein a person was allowed to claim HRA exemption on rent paid to his wife. Please note that such judgments are delivered for specific case & situation and cannot be treated as law. It can always be challenged in higher court therefore till there is legal clarification on this topic it is advisable not to claim HRA exemption for rent paid to spouse. Income tax department is not obliged to allow the exemption based on judgment in particular case.
3. I am Self employed / Businessman / Salaried without HRA Component, Can i claim HRA exemption?
This is one of the least known fact that if you are self employed, businessman or salaried who don’t receive HRA then also Income Tax Act provide relief as a tax payer.
You can claim HRA exemption under section 80GG provided you fulfill following conditions
(a) You have not received HRA during Financial Year
(b) You are living in rented accommodation and paying rent from your earning
(c) You don’t own/co-own rented house. You can carry out your business activity in rented house.
(d) You don’t own any other residential property in city of residence e.g. if you have a self occupied house in Paschim Vihar in Delhi and rented another residential house in Ashok Vihar for business activity. In this case, you cannot claim HRA exemption.
(e) If you have another residential property in city of residence then being self employed / businessman you cannot claim both Home Loan Tax benefit (Loss from let out property) and HRA on pretext that you are staying close to your work place. I will discuss this clause for salaried employees later in the post.
You can claim HRA exemption under section 80GG by filing declaration in Form No 10BA
If above mentioned conditions are fulfilled then HRA exemption can be claimed as a least value out of following three options
– Rs 2,000 per month
– Rent Paid in excess of 10% of your total income*
– 25% of your total income*
*Total Income means taxable income from all sources
For Example:
Rent Paid = Rs 10,000
Total Income = Rs 30,000
In this case, HRA calculation will be least of following
– Rs 2,000 p.m.
– Rent Paid in excess of 10% of your total income* = Rs 10,000 – Rs 3,000 = Rs 7,000 p.m.
– 25% of your total income* = Rs 7,500 p.m.
Least of above three options is Rs 2,000 p.m. therefore you can claim max HRA exemption of Rs 24,000 p.a. Normally, irrespective of total income or rent paid, max HRA exemption for self employed / businessman / Salaried without HRA is Rs 24,000 per annum.
How HRA is calculated?
For salaried employees with HRA as salary component, HRA exemption is restricted to least value among following three
– Actual HRA received from employer
– Actual Rent Paid minus 10% of Basic Salary#
– 50% of Basic Salary (If you live in Metro cities i.e. Delhi**, Mumbai**, Chennai and Kolkata) or 40% of Basic Salary# ( If you live in Non-Metro)
** Delhi include NCR regions like Gurgaon, Noida etc whereas Mumbai include MMR (Mumbai Metropolitan Region) like Thane, Navi Mumbai, Kalyan-Dombivali, Mira-Bhayandar etc
# Basic Salary = Basic + Dearness Allowance + Commission based on % of Turnover achieved by the employee.
Lets take Example (All calculations are monthly):
Basic Salary: Rs 90,000
HRA Received: Rs 40,000
Rent Paid: Rs 30,000
City of Residence: Thane (Mumbai Metropolitan Region)
Max exemption will be lowest of following
– Actual HRA received from employer = Rs 40,000
– Actual Rent Paid minus 10% of Basic Salary = Rs 30,000 – Rs 9,000 (10% of Basic Salary) = Rs 21,000
– 50% of Basic Salary = Rs 45,000
Least of three is Rs 21,000 therefore max HRA exemption is Rs 21,000. Balance amount i.e. Rs 40,000 minus Rs 21,000 = Rs 19,000 is taxable in the hands of the employee.
Imp Note: HRA is calculated on monthly basis. If there is a change in Rent Paid, Increase / Decrease in Basic Salary, change in HRA received or Change in city of residence from Metro to Non-Metro or vice versa then there will be corresponding change in HRA exemption for the month.
HRA as an Allowance
In Income tax, biggest confusion is between deduction and exemption. In layman terms, exemption means the component is non taxable provided the tax payer fulfill all conditions. Deduction means that particular amount is reduced from the taxable income. House Rent Allowance is exemption & in case of exemption if conditions specified under Income Tax Act are not satisfied then balance / full component becomes taxable. It cannot be deducted from taxable income.
Proofs Required
To claim HRA exemption, you need to submit following proofs
(a) Rent Receipts: Normally 2 Rent receipts are sufficient, one for the beginning of FY and 2nd towards the end of FY. Some organizations ask rent receipts for all 12 months and others may demand 1 rent receipt for each quarter.
(b) If per month rent is more than Rs 8,333 then Rental Agreement is mandatory
(c) If rent paid is more than Rs 8,333 per month then you require PAN details of the landlord
Details like name and address of landlord, address of rented premises, rent amount and month for which rent is paid should be clearly written on rent receipts.
HRA and Home Loan Tax Benefits
I receive max queries on this subject. There are various permutations and combinations and accordingly tax treatment is different. Home Loan Income Tax Benefits & HRA tax benefits are linked to each other. Lets discuss tax treatment of HRA under some common scenarios with an assumption that you own a property and availed Home Loan. Home Loan tax benefits will also differ in each of the following scenarios which i discussed in my post on Home Loan Tax benefits.
(a) You are staying in your own House: You cannot claim House Rent Allowance Exemption. Entire component will be taxable in the hands of employee.
(b) You own a house in City A & staying on rent in City B: You can claim House Rent Allowance Exemption.
(c) You house is under construction and you are staying in same city on Rent: You can claim House Rent Allowance Exemption
(d) Your House is in City A and you are staying on Rent in same City: This is most common query. You can claim House Rent Allowance exemption provided you can prove that your house is far away from your work place e.g. your flat is in Gurgaon and your office is in Noida. In this case you can claim tax benefits on both Home Loan and HRA. Also you need to declare rental income in your Income Tax returns. If your flat is vacant then you should declare notional rent. I have explained all possible scenarios in my post, How to calculate income from House Property?
Through intelligent tax planning, you can minimize your income tax outflow. We will discuss more such available exemptions and deductions under income tax act in future posts.
Hope you liked this post. Please feel free to post your queries through following comments section
Copyright © Nitin Bhatia. All Rights Reserved.
income tax rates for senior citizens please
0 to 3,00,000: Nil
3,00,001 to 5,00,000: 10%
5,00,0001 to 10,00,000: 20%
Above 10 lakh: 30%
Hi Sir,
My parents have a own house and they stay in a different city from where I work. I am staying in a hostel and the owner is not ready to provide me rent receipts. Is there any chance as per the income tax rules that I can get rent receipts from my parents and they declare the source of income in their tax filings even though my work location and my parents location is far(300kms apart).
It is not feasible as the distance between your place of work and parents house is 300 kms. You cannot prove that you travel daily to your work place from parents house.
Hi Nittin , I have same situation . My wife and family lives in Rented Accomodation at different location 120 kms from my office(delhi). Can I claim HRA for that house. I stay there but i do have temporary Paying Guest accomendation in Delhi.
you may claim. You can justify 5-6 hr travelling daily but it is subjective.
I work in different city and my wife stays in different city. Can I claim my HRA for her rents?
You cannot claim HRA against Rent paid by your wife or by you for her flat.
Hi Nitin, I work in Mumbai and also stay in a rented apartment in Mumbai. I have bought a house in Dombivili, Thane. I want to know can I claim both HRA and Home Loan benefits?
It depends on location of your office and rented accommodation.
Hi nitin, I have rented an apartment in navi mumbai since oct 2014 jointly with my wife. We work in two different organizations. I have been paying the rent since then and my wife would be paying the rent from april 2015. I would like to know if we both can avail 50:50 tax benefit under these circumstances. Also, as my organization doesnot accept rent receipts for tax deduction, can i file online ITR using these rent receipts at a later date. Thank You.
You have not mentioned leave and license agreement is in joint name or only in your name. Secondly how much is the rent.
Hi Sir,
My wife is a co borrower of the bank loan of which Housing loan has been granted and the property is in the name of both. Is she entitled to claim income tax exemption as i am not an income tax payee. Kindly advice
.
Yes, she can very much claim income tax benefits on Home Loan.
Dear Nitin,
I have a query in regards to the HRA claim for different cities. My company’s base location is Bangalore and I am working on a project which is based out of Korea. The project is such that we travel for 3 weeks in Korea and spend 1 week in India, during that course of period I generally go to Delhi either on vacation or at times I work from Delhi (from home) as well. The company doesn’t have any office in Delhi.
Can I claim HRA from Delhi considering the income would be shown under my landlord’s name as other income since I am not claiming it for Bangalore?
Just to check on your resident status.
There is no change in my resident status.
If your stay in India is based out of Delhi even though your company does not have any office in Delhi. Secondly, if your resident status is still resident indian then you can claim HRA for rent paid in Delhi.
hi
i stay in a rented apartment as my orgnisation is in bangalore.
my parents stay in a rented apartment in mumbai and they are retired. can i claim hra exemption for their rents as theirs is more compared to mine ?
You cannot claim
Hi, I have staying in a rented apartment in Kharghar and have a flat also in kharghar. can i claim both HRA and interest amount both. Also my office is in Malad, mumbai and I am staying in Navi Mumbai.
You cannot claim as you cannot justify why you are staying in rented accommodation.
Sir, can an employee claim deduction for rent paid for 2 houses in a city
You cannot stay in 2 houses simultaneously therefore you cannot claim HRA against 2 houses.
I live in a apartment which is registered to me and my mother. Can i pay rent to my mother to save taxes?
You cannot pay rent as you are co-owner.
Just wanted to double check if Thane is considered as Metro for 50% of basic applicability. Is there is reference in some income tax rules which we can refer to
Thane is under MMRDA (Mumbai Metropolitan Region Development Authority) therefore it is considered as Metro and you can claim 50% of Basic as HRA for tax exemption. You will not find income tax rule but definition of Metro means region under MMRDA
Now a days, apart from House Rent, Maintenance also form a substantial amount if take it on annual basis. I want to know, whether House Rent can be considered House Rent + Maintenance for claiming the benefit? Please guide in this regards.
Regards, Abhijit.
Maintenance cannot be clubbed with HRA for the tax deduction. The only option is that in your rental agremeent you mention consolidated amount as rent i.e. rent + maintenance then the entire amount can be claimed as HRA.
I receive HRA component as a part of my salary. I stay with my parents in a rented house and the rent agreement is in my father’s name. In this case can i claim exepmtion of HRA if i pay the rent even though the rent agreement is not in my name ???
Kindly guide me in this regards
Thank you
You cannot claim HRA.
I own a house which I have given for lease & I leave in a rented house both are in same city. I leave near to office & my own house is far away from my office.
Is lease amount received taxable?
In this case can I claim both home loan benefits & house rent exemption? If yes how to claim?
You can claim both HRA and Loss from Let out property. You declare your house as Let out.
Thanks Sir,
If I declare house as let out, do we require to mention lease amount received anywhere?
Is lease amount received taxable?
Any rent received is income from property which should be declared. It will be included while calculating loss from let out property.
Lease amount is not an income for us as we have to give it back to tenant when he vacates house.
I need to check your agreement then what is your income from this transaction.
I co-own Flat with my father ( joint registry). Can my father receive 100% rent ? My mother is a house wife but not a joint owner in this Flat. Can she receive rent of this flat? Both have a Pan card and file returns regularly and stay with me in a separate flat.
Rent is income which should be in proportion of ownership in my property therefore you and your father have to show in proportion of ownership in property.
Im staying in rented house for 3 months (april-june) and from july, will be shifting to my new house which is on housing loan, rent is 20k, how much HRA i should opt for?
And in between can i change the HRA ?
You can claim HRA for 3 months. You can change residential status in between the FY.
Hi Nitin.
I have own house with joint loan(mine+father) but registered on my name.And I am staying for rent beside office for convinience.eventhough My office and house is around 15km.
1. Can i claim both House loan benifit and HRA?
2.My brother used to stay in my own house without rent..In this case what’s the way to declare let out
1. You can claim
2. You can declare notional rent. Please check my following post for more details.
https://www.nitinbhatia.in/personal-finance/income-from-house-property/
Hi Nitin,
I m working with PSU and my wife working for private company.The rent agreement is on the name of both of us.Can we both claim the HRA exemption on shared basis??
For Example:–I claim 12000 pm and she claims 8000pm.where total rent is 20,000pm.
You both can claim in equal proportion.
Hi,
I have a small dobut-
Can I avail HRA benefit on 2 houses-
1. Showing that I live in 2 houses simultaneously.
2. Me living in one house and my wife who is a dependent of mine living in other one?
Thanks for your answer in advance :)
It is not feasible.
Nitin Jain
Hi Nitin,
I need your advise, as me and my father has two house both as co-owner in City A and City B. For City A house I am 1st owner for which we are paying EMI. For city B house my father is 1st owner. In City B I alone live. So can I apply for HRA(By paying rent to my father) CIty B house?
1st owner and 2nd owner does not have relevance, it is only to identify the party of agreement. As you are co-owner of the property in city B therefore you cannot claim HRA.
my wife and kids stay in rented house in mumbai and i work in bangalore. can i claim hra for mumbai house.
You cannot claim.
We are staying in a rented apartment with registered lease deed in the name of my wife. If I transfer certain amount every month to account of my wife (which is less than the total rent) , can I claim exemption for that amount?
You cannot claim tax deduction
Dear Nitin
Is there any rule that says that if both spouses are working, in separate private institutions, only one can be paid HRA by their respective employers.
There is no such rule.
Nitin,
I am paying rents for 2 houses (City A and City B). I am working in city A. Can i claim both the rents as part of my HRA. Also, if i dont have the HRA component can i then look at claiming these two rents ?
Thanks,
You can claim HRA for rent paid only in City A.
Dear Nitin,
I am staying in Delhi whereas my company office is in Noida. Now my company is allowing 40% of basic salary as actual HRA whereas i am staying in Delhi which being a Metro City i should be getting 50% of basic as exemption.
I have asked my HR about it & they claim that the company office is in Noida so they can not provide more than 40% of basic as actual HRA deduction. Previously they were allowing 50% but they are saying that they had done this based upon Auditor objection.
So is there a way i can claim 50% of my basic salary as HRA. Please reply as i am unnecessarily paying extra tax while i should get it as deduction.
I disagree with your company. As per income tax department, HRA is linked to place of residence of employee not the address of the office. You can stay in Metro but work in Non-Metro specially in NCR as Noida, Faridabad, Gurgaon etc are non-metro cities. As you are staying in Metro city i.e. Delhi therefore you are eligible for 50% HRA.
Mr.Nitin, As per your article, 50% of Basic Salary (If you live in Metro cities i.e. Delhi**, Mumbai**, Chennai and Kolkata) or 40% of Basic Salary# ( If you live in Non-Metro)
** Delhi include NCR regions like Gurgaon, Noida etc whereas Mumbai include MMR (Mumbai Metropolitan Region) like Thane, Navi Mumbai, Kalyan-Dombivali, Mira-Bhayandar etc.
Hence in both the cases, 50% exemption should apply.
Your understanding is correct but few companies consider some of the NCR and MMR regions outside the definition of Metro. Broadly, if the residence is outside city limits of NCR and MMR then it is not considered as Metro. For example, if an employee is staying in Sohna in Gurgaon or kalamboli (Gaothan) in Navi Mumbai then it is Non Metro but at the same time residence in Gurgaon city or Vashi/Kharghar in Navi Mumbai are part of Metro definition thus eligible for 50% of Basic salary as HRA.
I work in Mumbai, my mother lives in Rajahumndry(Andhra Pradesh). I am supposed to pay the rent for her. Can i include that in my HRA??
You cannot include.
I have received HRA for 9 momths for last fin yr in this year. As there were queries on HRA, hence it was given this year. And I have also received HRA for this year.
How can I claim tax rebate on last year’s amount?
You can claim HRA at the time of filing of Income Tax Return.
Dear Sir, My wife and my mother owned a Flat Jointly. Both are owners on paper for half-half portion of the flat. We all, my father, mother, my wife and children (all) are living jointly in the same flat. I am paying rent of Rs. 10,000/- to my mother as my family is using maximum area of the flat. she is using only one room though my family is using two bad rooms, kitchen, bathroom balcony and even some part of my mothers room. Can I pay her rent and take he tax benefit on the rent paid. The Rent has been paid in bank account and my mother will show it in her income tax return.
Dear Nitin,
I need your advice on HRA that I can claim for this year. I have worked for 2 different Organisations this year and I have 2 form-16s with me. I left my previous company in the month of October 2014 and I forgot to submit my rent receipts while leaving the company. I had an HRA component in my salary but as I didn’t submit any rent receipts, I didnt get any HRA exemption in my form-16 at the end of the year. Is there any possibility to claim this HRA now?
Also, in my current company, I didn’t see any HRA component in my salary breakup and again this is not reflected in my second form-16 too. However, the HR has asked me to submit the rent receipts and I have submitted them in the month of Jan 2015 while submitting the other tax proofs. Now, I am not getting proper response from HR regarding this and I am not sure even if they have a clear idea about this issue.
Based on my internet search since last couple of days, what I understand is that, when there is no HRA exemption/component available, we can use the section 80GG and claim a total of 24000/- per year. But for this, do we need to give any declaration and if yes, how to send this declaration copy to IT department?
Can you please suggest me what are all the possibilities I have for claiming the HRA now apart from 80GG?
Thank you very much in advance!
Regards,
Shravan
You can claim HRA at the time of filing of ITR and submit proofs. If HRA is not provided by your company then you may claim u/s 80GG. You can send declaration along with ITR.
Nitin Bhatia I have same problem , I forgot to submit rent receipts to previous employer(Apr14 to Oct14) but submitted to new employer(Nov14 to Dec14). Both companies i have HRA component in salary breakup. I have 2 questions:
1. Shall I show only Apr-14 to Oct-14 rent in 80GG , and deduct same amount from salary (6.Income chargeable under the head ‘Salaries'(3-5)) ?
2. When you say we need to submit proofs , that means we should send rent receipts along with ITR acknowledgment ? actually I am confused because don’t see any such option in incometax online form.
1. You can do that and claim exemption u/s10
2. You cannot submit proof along with ITR. In case of any clarification from Income Tax department you can submit proofs.
@nitinbhatia121:disqus thanks for such quick response. Just one question my rent during Apr14 to Oct14 was 8000 per month. In case of clarification from incometax department do i need to show rent receipts only or Rent agreement also needed? because I don’t have rent agreement.
Only rent receipts will work.
Sir,
I have a querry regarding the IT exemption with respect to HRA & House Rent.
My Basic Salary is Rs. 5500/-, the HRA I receive is Rs. 2750/- and I pay Rs. 4500/- as House Rent. Am I exempted fro m paying tax? By calculating from the above formula I pay Rs. 1200/- as excess amount.
Will have to pay tax or will I be exempted?
You may calculate as per formula shared by me in the post on this page.
I do have a HRA component as part of my salary but I could not submit the prrofs last year. Can I still claim exemption while filing the returns. I have not submitted any proofs
Sorry,i did read the questions posted to you earlier and it answers that I can claim exemption based on formulae you have shared. But question remains,what about proofs. You have said in response to one of the queries
….
You can claim HRA at the time of filing of ITR and submit proofs
where and how do I submit proofs??
You can submit proof if there is any query from IT department.
i am work in bangalore paid rent for Rs.10000 per month, but i have own house in chennai under housing loan bought a new flat for April 2015 in my name principal Rs. 132810 and interest Rs.285640, which rent HRA i can claim
Rent paid for Bangalore property
Hi Nitin
I have two houses . One near Pondichery in which my parents live. This is the house I am showing as Self occupied.
I have another house at Chennai, the city in which I am working. However I dont live in that house since it is far off from my work place. I have given my house for rent and living in a rental house. However I am showing the income from the rental house and also showing the deductions of 30 % and the House Tax in my IT returns.
I have the following query
In this case am i eligible for HRA Exemption since I live in the rental house ? Please let know
You can claim HRA but you have to show both houses as let out property.
I want to transfer the apartment in my name to my wife. What are the laws around that? I live in Pune maharashtra.
You can execute gift deed.
Dear nitin sir i stayed at company quater and hra deducted from my salary can i put that amount as tax saving
It is subjective. You have not mentioned that rent is paid to whom.
Dear All,
I’ve a query regarding House Rent Allowance.
I’m Working in a Pvt Ltd company, The Query is Company is paying rent to One of our Managing Director as perquisites who stays in his own house and claims rent from Company.
His Gross Rent for one year is 12 Lacs,
Is he liable to register under Service Tax.?
A company cannot pay rent for self occupied property.
Is he liable to register under service tax..?
Yes
Thanks Mr Nitin Bhatia.
Dear Nitin, In you article you have mentioned the following:-
50% of Basic Salary (If you live in Metro cities i.e. Delhi**, Mumbai**, Chennai and Kolkata) or 40% of Basic Salary# ( If you live in Non-Metro)
** Delhi include NCR regions like Gurgaon, Noida etc whereas Mumbai include MMR (Mumbai Metropolitan Region) like Thane, Navi Mumbai, Kalyan-Dombivali, Mira-Bhayandar etc
My question is does Fraidabad also come under 50% exemption.
Regards
Rajeeva Kumar
If you are staying in city limits then yes you are eligible for 50% of Basic as HRA but if you stay outside city limits then your company can refuse 50% of basic as HRA.
Thanks Mr.Nitin,
One more clarification, City limit that you are referring to means “Faridabad City Limits”.
Further can you provide me with the notification or any order or reference which mentions “** Delhi include NCR regions like Gurgaon, Noida etc”
There is no official notification but all the areas under the metropolitan region are metro areas.
my company considers noida as non-metro
can you provide/guide to official notification
There is no official notification and depend on your organizations policy. Technically, all the areas notified under local metropolitan authority are part of METRO Region thus your company can allow 50% HRA deduction for Noida.
Hello sir
I am staying in government quarters and my parents live in home town on rent. can I get HRA rent exception/allowance for my parents living in rented house
kindly reply
You cannot claim HRA.
Thank you for the reply
Not even rent deduction in this case
With regards Haridas
Unfortunately NO even if you are paying the rent.
Sir, I live with my father in his govt quarters. I work in a private firm. My firm gives me some part of my salary as hra. My father says that I should tell my company to give that part of salary under some other allowance as ideally I shouldn’t be given any hra as I live with him in his govt quarters. Does this argument hold any merit?
A salary structure is standard for organizations. The HRA received by you will be taxable. You may check with your organization if they are willing to club your HRA in some other non-taxable allowance.
Hi Nitin,
I’m living on rent in Jogeshwari East, Mumbai.
My question is what should be the HRA received by me?
My company is giving 40% HRA for a particular group and 50% HRA for higher designation group of employees. Is that fare?
Employer should decide the HRA % giving to an employee or it is rule under incom tax section that Metro cities’ citizen, who are residing on rent in Metro cities, surely eligible for 50% of HRA irrespective of employee’s designation?
Please refer me the link where it is mentioned as a rule in Incom Tax Rule book.
Bcoz They would need it as a rule.
Hi Nitin,
It would be very much appreciated if you provide me any link pertaining to this rule from any of certified authority. It would be very much needed as I’m losing alot of money as a tax.
Please assist me. Thanks in advance.
Please check S.No 9 i.e. Sec 10(13A) on the following official website of Department of Income Tax. Hope it will help
http://www.incometaxindia.gov.in/Charts%20%20Tables/Allowances_Available.htm
Hi Nitin,
Thanks a lot for your response.
But still my query is not resolved.
I just wanted to know that HRA given by EMPLOYER to any of its EMPLOYEES is fixed by goverment under any section or it would be totaly depends on EMPLOYER and they would decide the percentage of HRA given to their EMPLOYEES.
Like in my organization case. EMPLOYER (My Organization) providing 50% HRA to higer designation employees and 40% to lower level employees. So isn’t 50% for all employees irrespective of their designation.
I hope you get my query.
Please respond for this.
Thanks a lot.
Normally organizations make salary structure as tax friendly as they can. At the same time, an organization is FREE to decide the salary structure. It is not mandatory to include 50% HRA component in Metro Cities. It depends on organizations compensation policy. If contribution of Basic Salary is HIGH then organization keep HRA low to avoid any frivolous claims.
hello
i have a current housing loan & am taking one more housing loan. so there will be two housing loan. I am salaried & stay in a different city in a rented house. My query is can i claim HRA exemption & also deduction on Principal & interest on both the housing loans.
You can claim both HRA and tax deduction on a home loan. For the 2nd home loan, you cannot claim a tax deduction on the principal amount.
first house is rented & shown in ITR . second house is vacant,
For the 2nd home loan, you cannot claim a tax deduction on Principal amount. Also, for vacant property you need to consider notional rent to calculate income from house property.
Sir, I stay in a rented flat in Greater Noida and my fully constructed house is in Delhi. Can I still claim HRA as i have to stay in Greater Noida due to spouse job timings and restrictions? I am already claiming exemption under home loan interest category. Thank you.
You have not mentioned your office location. If your office is in Greater Noida then you can claim HRA.
Sir, my office is on noida greater noida expressway I.e. noida sector 127. Can I still claim hra? If yes, then I think I need to declare notional rent on already possessed home. Please confirm and thanks for your reply.
You can claim HRA. If your house in delhi is vacant then you can declare notional rent and if it is rented then you can declare actual rent received.
I am working in bank.I m staying on lease accommodation where rent agreement is between bank and my land lord. I am getting HRA as lease rent which i am paying to my land lord .So in this case am i eligible for HRA exemption ? In true sense it is not direct HRA which bank is paying to me. Request you to guide me.
As i understand, Your accommodation is “Company Leased Accommodation”. Company Leased Accommodation is a perquisite therefore you cannot claim HRA.
Hi,
I and my parents stay in rented house. Rental agreement is in my father’s name. My father is retired. I am working and pay the rent for home. I am eligible for HRA. Owner of the house refuse to give the rental receipt in my name.
Can the rental receipt be in my name? (even though the rental agreement is in my father’s name)
Thanks
As the rental agreement is in your father’s name therefore you cannot claim HRA even though rent is paid by you. A rental receipt cannot be issued in your name.
Hi mr nitin,
I stay in Gurgaon. We stay in a rented house. The rent agreement is in my name. My wife gets HRA in her salary at a government centre. Is she eligible to get tax exemption for HRA ? I do not draw HRA .
No, she cannot claim tax exemption on HRA.
Is it possible for her to claim exemption if she transfers the rental amount into my account by cheque/ electronic transfer and then I pay the amount to the landlord via my account?
Unfortunately NO, as the rental agreement is in your name. You can terminate the existing rental agreement and execute fresh agreement between landlord and your wife. After that she can claim HRA.