January 16, 2023
Riddhi Thakrar

What comes under the Section 80GG of Income Tax Act

The Income Tax Act of 1961's Chapter VI-A contains a specific provision known as Section 80GG that offers tax relief to taxpayers who do not use the house rent allowance. A person must live in a rented home in order to be qualified for a tax exemption under this section. Additionally, his or her company shouldn't include a house rent allowance (HRA) in the monthly income.

Professionals who are entitled for a salary and self-employment deduction may use Section 80GG. As a result, everybody who owns a business is eligible to claim this specific tax deduction, very much like their colleagues who earn a salary.

Eligibility criteria under the section

As earlier mentioned, there are requirements that must be met in order to qualify for write offs under this particular section of the ITA. Some of the requirements that someone must meet in order to claim the Section 80GG deductions are mentioned below.

1. These tax deductions can only be claimed by people and Hindu Undivided Families (HUF). Businesses and other businesses are not permitted to receive the same tax breaks while paying rent within a specific fiscal year.

2. This benefit is available to people who work for themselves or are salaried specialists. Even though a person pays rent, they are not eligible to apply for Section benefits if they have no income at all.

3. To be eligible for this tax break, applicants must first send the government a properly filled out Form 10BA. This form serves as a statement that the person submitting it makes no claims about any benefits from a self-occupied home.

4. Individuals who do not obtain a house housing benefit from their work are the target audience for this article. An individual is unable to file for income tax refunds for housing rent if his or her salary includes an HRA payment.

5. To receive tax advantages under this provision, the taxpayer must present a duplicate of the homeowner's PAN card if the annual rent exceeds Rs. 1 lakh. Remember that the person renting out the space must also be the owner of the PAN card.

6. A person is not eligible for the tax incentive under Section 80GG if they have ever claimed HRA during the financial year in question. For individuals who have changed jobs over the past 12 months, this is an important point. Although if one does not obtain HRA for the majority of the year, receiving it for just one month excludes one from being able to get this annual reprieve.

People who live with their parents in a home that belongs to their parents are also qualified to apply for Section 80GG assistance. One would have to execute a lease agreement with their parents in order to achieve this. Additionally, whenever the parents submit their annual taxes, the sum listed as rental will be subject to taxation.

This clause also allows non-resident Indians to seek tax benefits. To qualify for the very same, individuals must, nevertheless, be renting a house in India.

Availability of the form

Such forms are easily accessible from a number of places, such as the human resources division of any reputable organization. The same is also available from tax offices. Nevertheless, looking for one on the internet is the simplest option. People can look for it on many government sites and get it there.

Claim for the property owners

Landlords can only use Section 80GG deductions provided they meet the following two requirements:

1. They must be currently residing on a property and making rent payments on it.

2. The home or businesses they own shouldn't be close to where they work or live. Section 80GG doesn't really apply to your annual income taxes if they choose to live in a rental flat despite owning property within the city.

While collecting the rent advantages in the area where people work, someone can own properties in another city or region. In this scenario, the owner of the property is seen as being rented out.

With this knowledge on Section 80GG, people can easily cut their entire tax obligations by a sizable amount.

So, based on your income and the eligibility you can apply for the rent redemption under the section 80GG of Income Tax Act. Based on the criteria and income slab you will be benefited with the tax redemption.


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