New rule lowers HRA exemption claim limit:
If you are a salaried taxpayer claiming HRA (house rent allowance)
deduction, watch out. The central government has lowered the exemption
limit for reporting the rent received. Salaried taxpayers claiming HRA
exemption and paying a rent of over Rs 1 lakh per
year have to give landlord's PAN (permanent account number). Till now,
if the total rent paid was less than Rs 15,000 a month there was no need
to submit the landlord's PAN details. The new rule effectively lowers
the rent limit from Rs 15,000 a month to Rs 8,333 per month for claiming
HRA exemption without making any disclosures.
"Further, if annual rent paid by
the employee exceeds Rs 1,00,000 per annum, it is mandatory for the
employee to report PAN of the landlord to the employer," the Central
Board of Direct Taxes said in its latest circular. "In case the landlord
does not have a PAN, a declaration to this effect from the landlord
along with the name and address of the landlord should be filed by the
employee," it said.
Though incurring actual
expenditure on payment of rent is a pre-requisite for claiming deduction
under section 10(13A) of the I-Tax Act, it has been decided as an
administrative measure that salaried employees drawing HRA up to Rs
3,000 per month will be exempted from production of rent receipt.
Source : http://timesofindia.indiatimes.com
