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Income tax query

Tony John (Chartered Accountant) (6085 Points)

30 January 2012

Pls Advise:

Mr.A receives HRA from his employer and it is taken as fully taxable. He pays rent for the last 4 months of the FY.

Is he eligible for deduction under Sec 80GG ?? If so, how do we calculate the actual amount of deducton for the 4 month period ??

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leeladhar (apprentice) (261 Points)
Replied 30 January 2012

"An assessee is entiltled to deduction in respect of 80GG if he hasn't been received HRA which qualifies for exemption under section 10(13A) of the Act."

So in this case he is not eligible to claim deduction under 80GG.

Tony John (Chartered Accountant) (6085 Points)
Replied 30 January 2012

But in this case, though he receives HRA, he isn't availing exemption under Sec 10(13A)

leeladhar (apprentice) (261 Points)
Replied 30 January 2012

The Act clearly states that "An assessee is entiltled to deduction in respect of 80GG if he hasn't been received HRA which qualifies for exemption under section 10(13A) of the Act."

It is irrespective of whether he claims exemption for HRA or not.

Here in this case it is clearly mentioned that the employee receives HRA,so he is not eligible for deduction under 80GG.

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(Guest)

Organizations using this method calculate HRA exemption each month, and add the monthly HRA exemption values to arrive at the exemption for the year.

1. Monthly HRA exemption amount — after applying the “least of three” rule for each month — from April to July and from October to March = Rs 20,000 per month.

2. Monthly HRA exemption amount — after applying the “least of three” rule — for August = Rs 0.

3. Monthly HRA exemption amount — after applying the “least of three” rule — for September = Rs 12,500.

The total of HRA exemption amounts across all months = Rs 212,500 for the year.

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Tony John (Chartered Accountant) (6085 Points)
Replied 30 January 2012

Thank You both of you sirs.

g.r.sharma (spl assistant) (21 Points)
Replied 29 February 2012

my son giving gift to mywife the amount which is invested in bank fds .my question is whether the income earned from this gift will be clubed in either in my hands or in the hands of my son or it will be treated independent income of my wife