Exemption of House Rent Allowance (‘HRA’)
under section 10(13A) of the Income tax Act, 1961 (‘the Act’)
HRA is a taxable receipt, however section 10(13A) of the Act, grants exemptions is respect of any HRA received by an employee from his employers, but certain conditions must be satisfied for this purpose.
A. Conditions to be satisfied:
1 The allowance must be specifically granted to the employee by his employer
2 The employee must have actually incurred expenditure on payment of rent
3 The residential accommodation occupied by the employee should not be owned by him
B. Working of exemption
C. Further points:
Rent paid to wife/father/mother- Yes, HRA can be claimed subject to actual payment and please note house property must be on third own name.
Rent paid outside India for stay outside India –No deduction allowed HRA exemption available only for rent paid for living in India
Own house in one city and staying on rent house in other city- yes deduction allowed
No HRA mentioned in the salary slip- It means no HRA allowance provided by the employer, without any allowance we cannot claim HRA. Discuss with the employer
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