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Income Tax Returns 2024: House Rent Allowance is exempted for salaried people to help them with their living expenses. HRA is used to reduce the taxable income of a salaried person and reduce the tax liability.
HRA limit according to cities
HRA for four metro cities Delhi, Mumbai, Kolkata and Chennai 50% of Basic Pay + DA for Metro cities
HRA for other cities 40 percent of basic pay + DA for non-metro cities
What documents will be required to claim HRA deduction?
To claim HRA deduction in income tax return, a salaried individual needs certain documents-
Rent Agreement- The rent agreement is a solid proof that you have rented out your house. There must be a valid rent agreement for the current financial year to be eligible for the deduction.
Rent receipt- A rent receipt is also required along with the rental agreement. The receipt must be stamped for the amount paid as rent every month during the financial year. A receipt will also be required in case of electronic payment.
PAN card of the landlord- To claim HRA deduction in your income tax return, you need to provide a copy of the landlord's PAN card. If you are paying rent of more than Rs 1 lakh in a year, then a photocopy of the landlord's PAN card will be required.
Proof of payment- Whatever the mode of rent payment, you must have proof of rent. Bank statements, online transaction receipts and other proofs can be useful for this.
Family member's rent- If you are paying rent for a family member, you can still claim the deduction. However, there must be valid proof and documents for paying this rent.
Employee Declaration Form: If you are a salaried employee, your employer may ask you to fill an employee declaration form to claim HRA exemption. This form contains details about rented accommodation and rent paid.
If you are a salaried person and want to deduct HRA and show it in Form 16, you will have to submit all these documents to the employer. However, you can also claim HRA while filing ITR.
