1. What you can do? How can you reduce your Income tax burden? Sanjeev Sharma , Delhi
Ans) You can pay rent to family member who owns the house like your Father, Mother. any of your grand parents or spouse.
2. How to avoid mistake? What care should be taken? Smriti Mittal, Bangalore
Ans) This is the best Income Tax saving option available to salaried employees. This help gets exemption upto 50% of your salary. However, employees always make a mistake to pay rent to their family member who does not own the house. Please ensure that:
1) Family Member to whom you are paying the rent actually owns the house.
2) If the total rent paid to the family member + his /or her other income like (rent or interest etc ) exceeds the total taxable limit, do file the income tax return of that family member. Non filing of the income tax would land in you tax trouble.
3) If you are in higher tax bracket, It make sense to pay small amount of Income Tax ( if the total income of that family member exceeds the taxable limit) , this way you can minimise your overall total Income tax burden.
3. Is Banglore considered as Metro for purpose of HRA ? Will i get 50% deduction if i give rent in Banglore? Malati , Bangalore
Ans) Banglore is not considered as Metro for pupose of HRA calculations . Only 4 cities, Delhi, Chennai, Mumbai and Kolkata are considered as Metro for purpose of HRA calculations.
Cities like- Faridabad, Noida, Gurgaon, Hyderabad, Pune, Ahmedabad are not considered as metro for purpose of HRA deductions.
4. Can i Claim both HRA and Housing loan Interest? Ravi, Gurgaon
Ans) You cannot claim if both the rental property, and own house is within same city.
4. My employer has asked for Pan card of my Landlord. What should i do? Shefali, Gurgaon
Ans) If you are paying rent of more than Rs 15000/- per month then you are required to give PAN card of your landlord.
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