What is House Rent Allowance?
Frequently Asked Questions
If you live in your own house and have no rental expenditure, you’re not eligible to claim HRA exemption under this section.
In case you own a house in one city, but reside in a rental house elsewhere because of your job location, you’re eligible to claim exemption of house rent allowance as explained above.
Yes. If you own a house property for which you’ve availed a home loan, and you stay in a rental house elsewhere, you can claim exemptions on the home loan’s principal amt as well as on the HRA earned, if you are able to furnish sufficient proof(s) for the same.
Salaried employees who reside in a rental house but don’t receive HRA from their employer cannot claim HRA exemption under Section 10(13A). However, there is an option offered under Section 80GG of the Income Tax Act, 1961.
Yes. HRA is dependent upon the city in which you stay. Shifting from a non-metro-politician city to a metro-politician would change your HRA from 40% to 50% of your Basic Salary.
Documents like PAN card of landlord, Rent receipt and photocopy of the rent agreement (if required), etc. are required to claim HRA exemption.
In such a case, place of residence will be considered for HRA calculation and not place of work.
Yes, if both of them are paying rent to the landlord and both can furnish separate receipts. However, there should not be duplication which might lead the income tax department to deduct twice the tax from landlord's income from property.
Under this section, self-employed people and salaried employees who aren’t paid HRA can claim a minimum of the following as deductions:
- ₹ 5,000 per month
- Total Rent Paid minus 10% of Basic Salary
- 25% of the Adjusted Gross Total Income.
If HRA is not mentioned in Form-16 it means your employer has not provided a separate component of HRA. HRA under Section 10(13A) can be claimed when a separate component towards HRA is given by the employer. In absence of it, you can claim for rent paid under Section 80GG.
No, individuals paying rent but do not receive house rent allowance are allowed to claim deduction under Section 80GG. Also, the individual, spouse or children should not own a house property in the place of employment for claiming this deduction.