Tuesday, August 30, 2016

Deductions on House Rent

Section 80GG: Deduction for House Rent Paid where HRA is not received
This deduction is available for rent paid when HRA is not received. Taxpayer or his spouse or minor child should not own residential accommodation at the place of employment.
Taxpayer should not have self-occupied residential property in any other place.
Taxpayer must be living on rent and paying rent.

Deduction available is the minimum of
Rent paid minus 10% of total income
Rs. 2000/- per month
25% of total income

For Financial year 2016-17 – For calculating deduction above, Rs 2,000 per month has been raised to Rs 5,000 per month. Therefore a maximum of Rs 60,000 per annum can be claimed as a deduction.

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