I have an apartment that I am planning to gift it to my parents after I close home loan. I will be closing loan by August end. Currently and in future too my parents does not intended to stay at this apartment. Hence once I close loan I will not be able to claim Principal and Interest component, however as I will be gifting home to my parents, once gifting procedure is done, I will be paying rent for this apartment to my parents. Based on this scenario I have following questions: 1. As I will be gifting this home to my parents, hence legally it will be theirs. For this home can I pay rent to my parents and claim HRA once gifting process is complete and I enter rental agreement with my parents? Though I have paid complete money for this apartment. 2. Can I claim HRA as well as home loan interest, principal component for same home for this financial year? 3. Do I need to declare somewhere while filing next IT return that I have gifted my home to my parents? As in past financial years I have claimed interest and principal component of home loan for deductions under relevant sections? 4. What rent amount I should be paying to my parents to claim HRA, Is there any upper cap ?
13 April 2015
You can claim HRA exemption if you are staying at that apartment and paying rent to your parents through bank transfer. refer case, bajrang prasad ramdharani vs CIT. If YOU ARE NOT STAYING AT that home, arrangement above is not proper.
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