Section 80GG of the Income Tax Act provides tax deductions for individuals paying house rent but not receiving House Rent Allowance (HRA) from their employer.
This is especially useful to employees who do not receive house rent allowance (HRA) from their employers. Tax exemption under Section 80GG depends on your salary, the city in which you are staying (Tier-I, Tier-II, Tier-III, etc.), the rent amount and the HRA received.
For you to be able to avail the house rent-related deductions under Section 80GG, the following conditions have to be met:
You must meet the below listed conditions to be eligible for Section 80GG deductions of the Income Tax Act:
Under this section, you can claim the least of the below applicable amounts:
To understand this, let us consider an example. Ramesh earns Rs.7 lakh annually and does not get HRA. He is paying a rent of Rs. 18,000 per month, i.e., Rs.2.16 lakh.
Let us now apply the above 3 amounts to determine the corresponding amounts.
Ramesh will be able to claim only Rs.60,000 as tax deduction.
If you are living with your parents, there is an interesting way to avail yourself of the benefits under Section 80GG. You could enter into a rental agreement with your parents and pay a specific amount - at least Rs. 60,000 - as rent to your parents. However, your parents will have to show that amount as income in their income tax declaration.
With the real estate rates nowadays, it is quite impossible that the least amount would be anything other than the limit of Rs. 60,000 allowed under Section 80GG. And if you are paying rents lower than Rs. 5,000 per month, it is highly likely that you are in a smaller town and your income is proportionately low and hence exempt from payment of income tax altogether.
In addition, most companies nowadays offer House Rent Allowance as part of the salaries, which will automatically exclude you from being able to claim benefits under Section 80GG.
If you are looking to receive benefits under Section 80GG, then you will have to fill the Form 10BA. The correct way to do this is given below:
You can access this form from the human resources department of the firm that you working for as an employee. You can also get the form from your nearest tax office, or simply visit download it online.
The below-mentioned documents must be submitted to claim deductions under Section 80GG:
Property owners looking to claim deductions under Section 80GG can do by fulfilling two major criteria. They are mentioned below:
No, you cannot claim benefits under Section 80GG if the property is in the name of your Father. You will need to submit Form 10BA to claim the benefit.
No, you claim either HRA or 80GG but not both.
If you own a home but rent a home in the same city, you cannot claim a deduction under Section 80GG. Additionally, the benefit is not accessible to someone who owns a home in another city and claims a tax benefit for it, such as a deduction for home loan interest under Section 24(b).
Long-term and short-term capital gains are not included in adjusted total income. The only gains exempt from the 10% tax under Section 111A are short-term capital gains.
You cannot claim deduction under Section 80GG if you own a property of your own.
Yes, self-employed individuals can claim deductions under Section 80GG.
Yes, you can claim deductions under Section 80GG on the rent you are paying for the rented house.
It is a declaration that must be filed by a person who wishes to claim a deduction under section 80GG for paying rent on rental property.
Form 10BA can be obtained from the organisation's HR department or tax offices. It can also be downloaded from the income tax website.
Credit Card:
Credit Score:
Personal Loan:
Home Loan:
Fixed Deposit:
Copyright © 2025 BankBazaar.com.