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Is there any limit on HRA exemption?
The HRA exemption limit is the lowest of the following three provisions: The actual rent paid minus 10\% of the basic salary + DA (Dearness Allowance) In case an employee is staying in a metro city, 50\% of the basic salary and 40\% if he lives in a non-metro city. The total amount received as HRA from the employer.
How much percentage of HRA is exempt from tax?
As per the income tax rules, the tax-exempt part of the HRA (House Rent Allowance) is the minimum of the following amounts: Actual HRA component of salary. 50\% of basic salary if he resides in Delhi, Chennai, Kolkata, or Mumbai; 40\% if his residence is in any other city. Actual rent paid less 10\% of basic salary.
What is the max HRA limit?
50\%
Claim Rules for HRA Your allotted HRA cannot exceed more than 50\% of your basic salary. As a salaried employee, you cannot claim for the full rental amount you are paying. Your exemption will be based on the least of the below mentioned options: The actual amount allotted by the employer as the HRA.
Can HRA be more than 50 of Basic?
Your allotted HRA cannot exceed more than 50\% of your basic salary. As a salaried employee, you cannot claim for the full rental amount you are paying. Your exemption will be based on the least of the below mentioned options: The actual amount allotted by the employer as the HRA.
How can I get HRA exemption?
For them, Section 80 (GG) of the Income-tax Act offers help. An individual paying rent for a furnished/unfurnished accommodation can claim the deduction for the rent paid under Section 80(GG) of the I-T Act, provided he is not paid HRA as a part of his salary by furnishing Form 10B.
Who can claim HRA exemption in India?
All employee in India is eligible to claim HRA exemption if below mentioned conditions are met: (a) Residing in Rented Accommodation by the employee. (b) Employee is paying Rent for the house. (c) HRA should be listed as a part of salary package in the beginning.
What is the HRA amount for rent in India?
The lowest of annual rent actually paid minus 10\% of basic salary, HRA paid by the employer and 40\%/50\% of salary depending on where you stay can only be claimed. For HRA calculation purposes, only Mumbai, Delhi, Chennai, and Kolkata are considered metro cities. All others are non-metro cities.
How to claim HRA tax exemptions on rent paid for house rent?
In case the rent paid towards house rent is more than Rs 1 Lakh, the individual can claim HRA tax exemptions towards it. He or she will have to furnish the PAN details of the property owner, along with the rent receipts.
Which HRA component would be exempt from income tax during 2019-20?
Let us understand the HRA component that would be exempt from income tax during the FY 2019-20. Therefore, in the above example, the entire HRA received from the employer is exempt from income tax. How to Claim Deduction Under Section 80GG?