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Rent Paid to Wife

Jignesh (Service) (66 Points)

12 January 2009

I stay with my wife wherein the property is owned by her (100%). House is in name of wife. There is no bank loan on any of us.

Every month I transfer a fixed amount to her bank account as Rent, and for this a receipt is issued by her.

I get a HRA as part of salary, can I claim tax benefits against the same. Please advice.

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11 Replies

Sulay Shah (Article Assistant) (54 Points)
Replied 12 January 2009

yes you can claim HRA exemption

Sripada M (CA) (365 Points)
Replied 12 January 2009

Yes, you can claim HRA.

Jignesh (Service) (66 Points)
Replied 12 January 2009

Thank you Sulay -

Can you help me to calculate the tax savings on HRA based on the following figures (per month). I have to put in imaginary figures, as cannot post actuals. Either ways please advice the actual savings on HRA tax:

Basic Salary 15,000
Conveyance Non Taxable 800
House Rent Allowance 5,000
Sundry Medical 250
Leave Travel Allowance 6000
Personal Allowance 400
Special Allowance 4000
Variable Allowance 3000
Vehicle Maintenance 1,000
Total Salary before tax 35,450

Rent paid per month : 10000

Sripada M (CA) (365 Points)
Replied 12 January 2009

Hi Jignesh,

HRA exemption is less of the following:

Actual HRA recieved = 5000

Rent paid - 10% of Basic = 8500

40% of Basic = 6000

R.Suresh (Sr. Executive) (394 Points)
Replied 12 January 2009

You are not allow to claim HRA because the house in the name of spouse only and also you are staying with her only, so no claim is available in your case.

Jignesh (Service) (66 Points)
Replied 12 January 2009

You are not allow to claim HRA because the house in the name of spouse only and also you are staying with her only, so no claim is available in your case.

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Suresh - Your reply is confusing !!!! Are you saying I cannot claim HRA even if i am paying rent to my wife?

Other participants have said that I can claim !!! Please advice what is your point of observation and further in what scenerio can i claim HRA tax benefit.

Atul Kumar (CA) (504 Points)
Replied 12 January 2009

I'd suggest that you are legally entitled to claim HRA Benefit by paying Rent to your wife. However, it would be safe if you file ITR of your wife showing that rent as her Income.

Rohit Mehrotra (Finance) (28 Points)
Replied 21 February 2009

Hi All, I have a related query :

flat is owned by me and till date i am paying the home loan. Can i claim HRA if I start paying rent to my wife and wife then start repaying EMI on home loan from it and start showing rent received and interst paid in her tax returns ?

Rohit

Rohit Mehrotra (Finance) (28 Points)
Replied 21 February 2009

BTW, I just read this forum and it seems we can not pay rent to wife and stay togather - /experts/experts_message_display.asp?group_id=95546

rohit

edwardraj (ACCOUNTS MANAGER) (34 Points)
Replied 25 November 2010

PLEASE SOME ONE HELP ME , I AM AN ADVOCATE, I AM IN RENTED HOSE PAYING RS 5500/- P MONTH, AND MY OWN HOUSE I HAVE RENTED OUT FOR RS 9000/- , WHILE FILING FORM IV HOW RENT PAID AND RECEIVED SHOULD BE TREATED