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If you are paying rent and getting HRA allowance every month, you are eligible for tax deductions according to the prescribed limit of HRA exemption. If you want to avail of the benefits, you must submit the rent receipts to your employer every year at the time of the collection of tax proof. Central Board of Direct Taxes (CBDT) has vide CIRCULAR NO. 8/2013, Dated: Dated: October 10, 2013 said 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. 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.

If your house owner does not have a PAN, you need not worry, as long as he/she is ready to sign a self declaration stating he does not have a PAN. You can submit a copy of this declaration to your employer and avail of the HRA deduction.

claiming-HRA

Rent Receipt without PAN- Sample declaration format

A Format of Deceleration May be as follows :-

Date

To

Name & Address

DECLARATION

I ____________(Full name and address of the declarant) aged ____ do hereby declare that I have leased the Flat No._______________________________ From 1st April’2018 to 31st March’2019 to ___________( Name of lessor) at a monthly rent of  Rs. _______/- ( __________________ only). Further I do hereby declare that my total income during the financial year 2018-2019 did not exceed the statutory  limit prescribed under Income tax Act,1962 and have not assessed to tax and does not have a PAN card .

Verification

I,_________________ do hereby declare that what is stated above is true to the best of my knowledge and belief.

Verified today, the _____________ day of _________________

Date : ________________Place : ________________ (Name of The Declarant)

EXTRACT FROM THE CIRCULAR NO. 8/2013, Dated: Dated: October 10, 2013 RELATED TO HRA

Under section 10(13A) of the Act, any special allowance specifically granted to an assessee by his  employer to meet expenditure incurred on payment of rent (by  whatever name called) in respect of  residential  accommodation  occupied  by  the assessee  is  exempt from Income-tax  to  the  extent as may  be  prescribed,  having  regard  to the area or place in which such accommodation is situated and other relevant considerations.  According  to  Rule
2A  of  the  Rules,  the  quantum  of exemption allowable  on  account  of  grant of special allowance to meet expenditure on payment of rent shall be the least of the following:

(a)  The actual amount of such allowance received by the assessee in respect of the relevant period i. e. the period during which the accommodation was occupied by the assesse during the financial year;  or

(b) The actual expenditure incurred in payment of rent in  excess  of  1/10  of the salary  due  for  the relevant period; or

(i) Where  such  accommodation is situated in  Bombay, Calcutta,  Delhi or Madras, 50% of the salary  due to the employee for the relevant period;  or

(ii) Where  such accommodation is situated in any other places,  40% of the salary due to the employee  for the relevant period,

For this purpose, “Salary” includes dearness allowance, if the terms of employment so provide, but excludes all other  allowances and perquisites.

It  has to be noted that only the expenditure  actually incurred  on  payment  of rent in  respect of  residential  accommodation  occupied  by  the assessee  subject  to  the limits laid down in Rule 2A, qualifies for exemption  from income-tax. Thus,  house  rent allowance  granted  to an employee  who  is residing in a house/flat owned by him  is not exempt from  income-tax. The  disbursing authorities should satisfy themselves in this regard by insisting on production of  evidence of actual payment of  rent  before excluding  the House Rent Allowance or any portion  thereof from the total income of the employee.

Though  incurring actual expenditure on payment of rent is a pre-requisite for claiming deduction  under  section  10(13A),  it  has  been  decided  as  an  administrative  measure  that salaried employees drawing house rent allowance  upto Rs.3000/-  per  month will be exempted from  production  of rent  receipt. It  may,  however, be  noted  that  this concession  is  only for the purpose of  tax-deduction  at source, and, in the regular assessment of the employee, the Assessing Officer will be free to make such enquiry as he deems fit for the purpose of satisfying himself that  the employee  has  incurred  actual expenditure on payment  of  rent.

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. 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.

(Article was first published on 03.12.2013 and republished on 07.08.2015)

Also Read:

1.Whats Better House Rent Allowance or Deduction u/s 80GG

2.House Rent Allowance (HRA) Taxability & calculation

3.House Rent Allowance Vs Rent Free Accomodations

(Republished With Amendments)

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71 Comments

  1. K.Venkata Reddy says:

    Hi,
    I want to get clarity that submission of declaration from the landlord for claiming house rent paid is still in force as per the circular CIRCULAR NO. 8/2013, Dated: Dated: October 10, 2013.

  2. Lokesh V Kuckian says:

    Can anyone send me the forms that needs to be submitted to HR regarding HRA?
    1. Form to be submitted along with PAN copy of landlord other than rent receipt
    2. In case landlord doesn’t have PAN copy
    Thank you

  3. Manish says:

    If you plan to claim tax exemption under house rent allowance (HRA) for the current financial year, remember that you will have to furnish the Permanent Account Number (PAN) of your landlord if your annual rent exceeds Rs.1 lakh, or Rs.8,333 per month. Earlier you had to furnish PAN of your landlord only if annual rent exceeded Rs.1.80 lakh, or Rs.15,000 per month

  4. Ayush says:

    Hey,
    Is there any change in the policies regarding submission of declaration if owner don’t have PAN card? Is it removed from this year and only PAN card is accepted and not declaration? Please provide the details. Thanks.

  5. niharika says:

    I have the rental agreement dated 10 Dec 2014. Can I submit this rental agreement as proof of rent to my employer.

    If no, then can i make a new agreement dated say 20/01/2016 and get the signature of owner and submit to the employer for financial year 2015-2016 to claim HRA examption. Please advise at the earliest.

  6. raghav a k says:

    my son is working in mnc in bangluru and residing in flat room shared by one more friend and paying rs 7000/- each for the same. his employer paying rs62000/= p a as house rent allowance. kindly advice for getting max exemption of HRA. is he have to get rent receipt from the house owner.

  7. suresh says:

    Dear sir

    I was in tuticorin from Apr 2015 to Dec 2015 on my previous company. now i am working on another company in another city. on both case i had diferent lanlord . on my first landlord i paid 90,000 thousand & on my second is 30,000. Shall i need to submit PAN CArd for both landlord?

  8. surya says:

    owner does not give PAN nor ready to give rent agreement copy/receipt. as i transferred money through net banking; i have full record in my account statement. how do i claim HRA in this condition.

  9. Pabitra Mohan Jena says:

    One logic, I am not convinced about the Govt. strategy while dealing with the Salaried tax payers.
    Govt is least bothered about the liabilities/basic payouts of a salaried person while fixing the computation of tax. It’s okay.
    But, why not allowing the person to enjoy his/her allowances by putting some hindrances here and there.
    Here, the question is about the computation of House Rent exemption amount.
    Suppose, somebody is getting Rs.1,44,000 HRA per annum, that means he is capable of paying rent for Rs.12000/- pm. But, if his financial condition does not allow him/her to afford that, and he has managed to stay in a smaller room paying rent of Rs.6000/- pm., then straight away this benefit should on his/her side. But, as per the tax computation he/she will entitled for the exemption only on Rs.6000/- pm.
    Agree, the exemption should be provided against the actual payouts where it is the question of LIC/PPF etc. But should not be in case of HRA atleast… It’s my opinion…

  10. Sahil says:

    Any one who has rent receipt and whose landlord is not providing PAN can try this

    Things you require
    1. Landlord’s father’s name
    2. Landlord’s DOB

    And you can get these very easily

    Then go to google.com and type know your pan
    Enter these details and you will get PAN number of landlord which can be quoted in investment declaration form our rent receipt.
    Most companies don’t require physical copy of PAN.

  11. Pradeep says:

    Rent Receipt without PAN
    Landloard has provided the signed self declaration for not having PAN and monthly rent paid is 20,000/-.
    The Actual Rent paid is 30,000/- Please let me know what should i do in this case.

    Thanks and regards,
    Pradeep

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