Benefit of HRA Under New Regime Of income Tax for House Rent

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“If HRA is not part of the salary package, one can claim deduction on rent. Further, taxpayer should not own a house in the same city where he is living on rent, nor should there be a house in the name of the taxpayer’s spouse, minor child or HUF of which the person is a member of, in the city where his/her office is located or business is carried out.”

There could be a scenario where the taxpayer switched jobs in 2020 or was employed with an employer offering HRA only for a part of the year. Taxpayers have two options in this case

“ If you are not employed for a part of the year and for the other part you have received HRA income from an employer, the taxpayer should have the right to claim a more beneficial deduction by foregoing another exemption. So, the taxpayer can choose between 80GG exemption and HRA exemption and surrender the other. However, the authorities might choose to contest this. ”

 

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