In the financial year 2022-23, I paid rent for the first four months (April to July ) then moved to my own new house. Can I claim a deduction u/s 80GG for the four-month rent paid?
C.P. Murugesan
As per section 80GG the Income Tax Act, 1961 (“the Act”), an individual wanting to claim a deduction can do so only if he is earning salary income or is a self-employed professional.
The following are the conditions an individual needs to fulfil to claim deduction under section 80GG of the Act:
· the individual should not be receiving House Rent Allowance (HRA) as a salary component at any time during the said financial year.
· Deduction is available in respect of any furnished or unfurnished accommodation; however, it is important that the same rented accommodation should have been occupied by the individual for his own residence.
· Neither individual himself nor his spouse/minor child/HUF of which he is a member should own any residential house in the same place/location where the individual performs official duties/ordinarily resides/carries causes his own occupation/profession.
· Form 10BA would need to be filed in order to claim the said deduction.
Provided the above-mentioned requisite conditions are met, the individual may be able to claim the deduction for part of year.
Deduction under section 80GG would be lower of the following:
· 25 per cent of the adjusted total income
· or Actual rent paid (-) 10 per cent of total income
· or ₹5,000 per month.
The writer is a Partner with BDO India LLP
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