HRA claim and document proof requiured

AT the time of efiling simply claim,deductions,let authority asked for proof,principally if they disagreed.

 Oh... Perhaps I did not explain it fully. In the begining of financial year, I have to make a declaration stating how much rent i willl be claiming.. how much investment i would be doing in this year etc... and according to it, the finance department will calculate the tax deduction.

Towards the year end, more specifically starting January, the finance department of the company will ask for the proof of all the declarations that I would have made in the begining of the year.

Now, for the HRA proof, they (our finance department) require the above documents. I want to know if it is within legal limits to ask for all these?

In my case, the landlord accepts the payment by cheque but does not want to give his PAN number or does not have it... Now, since I have declared rent as 14500pm and if I do not submit the PAN number of landlord, the finance department will consider me paying rent as 9000pm only and deduct the tax !

Hope i have made it clear this time...

You have to follow Payee,Company Rule,Nxt You May Claim Exemptions and Refund as per I.tax act,while filing your tax return.

 Can you please tell me what is meant by Payee, Company Rule? Since I am not from finance background, I am not so sure about it... Perhaps, I should start looking in Company Rules Act...?

In my opinion there is no specific rule regarding HRA but companies generally demand rent agreement to make sure that whatever rent you are paying is actual.

 Thats true... but our company requires the PAN number of landlord when rent paid is more than 9000pm. In case this is not provided, the rent amount is limited to 9000pm only.

Perhaps they are being extra cautious for some reason, but its been a major pain to the employees... and we cannot do anything about the same.

Thanks for clarifying.. perhaps its time to shift house and look for landlord who can share his/her PAN number !

In my opinion there is no specific rule regarding HRA but companies generally demand rent agreement to make sure that whatever rent you are paying is actual

Dear Mr. Arvind,

I am a bit late in responding to your query...but if :

1. your query is still unresolved, or,

2. you are still not completely satisfied or understood the HRA related laws in I.T. Act, or,

3. are yet to furnish your investment details to your company with any apprehension(s)  about HRA issues,

then pls. let me know. I would try to make you understand from the perspective of a non-finance background person. Rgds,

Manish.

Thanks for your reply Manish. The query is not yet resolved and I would really appreciate if you can share your thoughts on this.

Dear Mr. Arvind,

In the attached Word File, I have tried my level-best to help you out in the simplest possible manner and language regarding Rent Receipts Submission for availing HRA Exemption. Hope it will resolve your query to the fullest once for ever. Though a bit lengthy, every word in answer will carry some meaning. So just read carefully.

Thanks and regards,

Manish.

Dear Manish,

I have gone through the attached file. In the file you have mentioned that original rent reciept are required to be provided to the employer. Now my query is if at the time of assessment, if income tax department ask for the rent reciept than what will I show to them if original is given in the company. Also I am not able to understand when the employer considers the photocopy of investments for section 80C and consider it for calculating tds than why employer needs the original copy of rent reciept why not they keep photocopy in their records. Besided thsi if I came accress any dispute with my landlord and I dont have the rent reciept with me than how can I be able to give proof that I had paid the rent. 

Dear Rashi, In assessment process if the employer has worked out the HRA exemption, onus of proof rests with employer and the assessing officer shall ask the employer about the rent receipts based on which, he has calculated the exemption. But your 2nd point is really appreaciating. It will be required in case of any dispute between a tenant & the landlord. For Arvind, I am surprised that the company is demanding a PAN card in case the rent exceeds 9000. For a company, PAN card is required only where there is a contract between company & the owner and TDS is applicable on rent. i.e. Rent is directly payable by the company as per agreement to the owner of the flat and it exceeds 10000 per month. There is no legal requirement as such in case the rent is paid by the employee and an original rent receipt with agreement is sufficient for a claim of HRA. If an employee cannot provide the same, the entire HRA would be considered taxable while calculating the TDS on salary and the tax will be deducted. But there is again a chance to the employee to claim HRA at the time of filing his return of income without any documents. The documents would be required only if the assessing officer call fo it during the processing of return or an assessment.

Hi,

There is a lot of confusion, the employer needs original rent reciept for providing HRA exemption and at the same time employer is satisfied by photocopy of investments for allowing deduction u/s 80. For HRA exemption he needs original rent reciepts and for section 80 he is satisfied with photocopy. Too much contradiction.

If anyone has any case law or any circular in support of either original or photocopy of rent reciept to be taken by employer from employee. Please provide.