• HRA for rent when having home in same city

Hi,
I am in Bengaluru where the traffic & travel times are infamous. Hence I am thinking of taking on rent a house, nearer to my work place. But I have a home loan currently running for my flat in the outskirts of Bengaluru. And I have the said owned flat in the outskirts put out on rent, which I am claiming as my income.

As a salaried person, can I claim HRA for the rent paid and also claim exception for repayment on home loan for my flat in Bengaluru while declaring its rental income ?
Asked 14 days ago in Income Tax

- Ideally the house should be located at some other place other than the place of profession. As you have mentioned the house has been let out, the entire interest liability on home loan will be setoff with rental income. In such a scenario, you can claim HRA exemption alongwith interest benefit on housing loan. Even if the house is self occupied, you can claim the benefit of HRA exemption alongwith interest benefit keeping in view the practical difficulty. In such a case, interest upto Rs. 2 lacs will be setoff. If you are opting alternative tax scheme then no benefit of HRA exemption and interest benefit would be available. It is better to keep the owned house property on rent to avoid any litigation.

 

For detailed discussion, you may contact telephonically.

Vivek Kumar Arora
CA, Delhi
4222 Answers
399 Consultations

5.0 on 5.0

No I don't think that would be an issue especially when you are showing rent Income from same.

To calculate HRA value: https://www.taxontips.com/house-rent-allowance-hra-available-even-when-it-is-not-a-part-of-salary-slip-hra-calculation-calculation-sheet-available/

 

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Thank you

Naman Maloo
CA, Jaipur
3875 Answers
51 Consultations

5.0 on 5.0

Yes, you can claim both HRA and repayment for Home loan.

Ruchi Goel Anchal
CA, Gurgaon
467 Answers
5 Consultations

5.0 on 5.0

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