Income Tax deduction for house rent

Huge amount of house rent are paid by many employees.Due to lack of knowledge about deduction people fail to take benefit of deductions available under Income Tax Act 1961. Deduction can be claimed under section 80GG even if employees dont get HRA under section 80GG. Individual employees paying rent of house for his own residence can claim Income Tax deduction for house rent benefit under section 80GG subject to following conditions:

Income Tax deduction for house rent
Income Tax deduction for house rent
Income Tax deduction for house rent
  1. Declaration is filed under section form 10BA. 
  2. Employee is not receiving any house rent allowance which is eligible for deduction under section 10(13A) of the Income Tax Act 1961.
  3. Qualifying amount would be as least of following:
    1. Rs.5000 per month.
    2. 25% of adjusted total income*
    3. rent paid minus 10 percent of adjusted total income
  4. Fulfills below conditions:
    1. Employee does not own any residential accommodation himself or by his/her spouse or minor child or where such Individual  is a member of a Hindu Undivided Family, by such family, at the place where he ordinarily resides or performs duties of his office or carries on his business or profession.
    2. Employee does not own at any other place, any residential accommodation being accommodation in the occupation of the Individual, the value of which is to be determined under Section 23(2)(a) or Section 23(4)(a) under Income Tax Act 1961 as the case may be
* Adjusted total income can be arrived by deducting long term capital gain,short term capital gain of 10% category,deductions under section 80C to 80U except section 80GG,Income of foreign company from the gross total income.

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