Usually, HRA forms part of your salary, and you can claim a deduction for HRA. If you do not receive HRA from your employer and make payments towards rent for any furnished or unfurnished accommodation occupied by you for your own residence, you can claim a deduction under section 80GG towards the rent that you pay.
An individual should reside in a rented property and not own property in the same city to claim a deduction under Section 80GG. If the employer provides a Home Rent Allowance (HRA) as part of the monthly salary, an individual will not be eligible to claim a deduction under this section.
Section 80GG deduction is applicable to salaried and self-employed professionals. Thus, if an individual is a business owner, he/she will be eligible to claim tax deductions under this section. Individuals residing on their parents' property, which they own, are also eligible to claim Section 80GG benefits. However, such individuals should sign a rental agreement with their parents and give rent to them. The rental amount paid to their parents will be taxable when they file their ITR.
A taxpayer must fulfil the following conditions to claim a deduction under Section 80GG:
The lowest of these will be considered as the deduction under this section-
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Form 10BA is a declaration that has to be filed by an individual who wants to claim a deduction under section 80GG for rent paid on rental property. It is a declaration that you are not claiming the benefit of a self-occupied property on the house in any other location or the same location as you are employed. Following are the details to be filled in 10BA:
An individual can get Form 10BA from the HR department of the organisation or tax offices. They can also download the form online from the Income Tax website.
Eligible individuals can claim the deduction while filing ITR when they satisfy the following conditions:
No, if you are claiming HRA, then you cannot claim a deduction under section 80GG. The benefit can be availed of one only, i.e., HRA or Section 80GG.
Only salaried individuals who do not receive HRA, can claim deduction under this section.
It is a declaration that has to be filed by an individual who wants to claim a deduction under section 80GG for rent paid on rental property.
Yes, you can pay the monthly rent to your parents. However, you need to enter into a rental agreement with them, and they must include the rental payment as part of their income.
Yes, you can claim a deduction under Section 80GG for the rent you are paying since you do not have your own house in Delhi.
Yes, you can claim Section 80GG benefit when the property is in your father’s name and you are paying rent to him. You must enter into a rental agreement with your father and submit Form 10BA to claim the benefit.