Help for Claiming HRA exemption

The deductions on HRA are eligible under Section 10(13A) of the Income Tax Act and will depend on certain laws. An individual can claim an HRA exemption only if the following three conditions are satisfied:

• An HRA allowance is received as part of the salary package.
• If one is staying in a rented accommodation and paying rent for it.
• The rent exceeds 10% of the salary.

On the other hand, rent paid to the parents is eligible for exemption. If you stay with your parents and pay rent to them then you can claim for tax deductions. However you need to keep all your rent receipts since it is the only proof that you are paying rent. HRA exemptions are only available on submission of rent receipts or the rent agreement.

Another factor that effects the tax exemption is the place where you live. If one resides in a metro city, he is eligible for a deduction of up to 50% of the salary or else the deduction is 40%.

Hence u can claim HRA from April 09 to March 10.

Dear Vedant,

Prity is rite but just to puut it in simple terms,

LEAST OF THE FOLLOWING WILL BE EXEMPT:-

1) HRA  - Rs. 6,264

2) Rent paid - 10% of Salary = 8,000-1,608 = 6,392 (assuming DA notforming part for retirement benifits otherwise 5,829)

3) 50% of Salary  = iT WILL EXCEED 8,000 (40% IN CASE HOUSE IS IN OTHER THAN METRO CITIES)

U CAN EASILY CLAIM THE ENTIRE AMOUNT OF HRA AS EXEMPT, SIMPLY BY PRODUCING RENT RECEIPTS TO UR EMPLOYER...

Priety & Amir ,

thanks for quick response. Just one small question , As last year agriment with my Father's name, so shall i take signature of my father on receipt?

if yes, then i should produce agreemnet between me & my father to my office.

Dear Vedant,

First of all, it is not madatory that there has to be rent agreement in writing...the only thing required is rent receipts as a proof of payment of rent..

I think u want to sat that ur father has paid rent to ur Landlord & u in turn has pais rent to ur father????rite

In this case u can produce the rent receipts signed by ur father...But y complicate things buddy, simply pay the rent directly to ur landlord, I know that the agreement is with ur father but u can always dischage ur father's obligation...

 thanks AMIR this helps me too.

 if a person pay rent to his father for the property registered in father's name then in such a case shell he claim exemption of HRA.

Dear Vikram,

If he is paying rent then yes law has not prohibited this thing...

Rent can be paid to relatives as well..(but again that doesn't mean that u start showing unduly huge amount as rent)

Yes, Aamir Sir is right. But if the agreement is between Employer and Landlord and if the employee is paying the rent to the employer by way of deduction from Salary. Even he can claim the HRA.

Hi Pankaj, U r rite................

But plzz call me Amir yaar...........

Amir,

Actually Agreement is with Power Of Attorny(POA) & My father, but as I am living with my father, I had paid whole rent to POA. I have contacted my Administration office,but they said for claiming HRA, the Agreemnet has to be between Me & Owner/POA . It means I can Claiim only for the period Oct09-Feb10 .

Dear Vedant,

ur Admin department is imposing conditions of their own...Just ask them to show u that where is the requirement of producing rent agreements...

Trust me it is not necessary that only agreement would be the proof of payment...U tell them a case that suppose if i make an agreement & don't produce rent receipts would it be eligible for exemption.. 

Agreements can be made & dicontimnued with the consent of both the parties..In this case what constitute the corobborative evidence of rent payment??? "it is the rent receipts" my friend...

As long as u r producing rent receipts u can claim exemption of HRA..

To settle things amicably, Just show ur Bank statements from which u r making payments of rent....

Amir,

I have already told the concern person that i was paying the rent via cheque. If you want, I can produce the bankstatement . but they are not ready to accept it .If dont mind can you give link where, I can found the concern LAW to show these guys .

Dear Vedant,

U r going in wrong direction.......Instead of u searching for the law...Let them search the requirement of rent agreement...

U straightaway tell them that U r ready to produce rent agreement but before that they should produce before U the law where it is written that rent agreement is required...

Trust me it is no where written, It's common sense man, what constitues a corroborative evidence of payment "Rent Receipts" or"Rent Agreement"

Amir,

Actually the guys are not admitiing it. They are asking for Agreement & rent receipts both. Thats the problem for me.