Landlord Not Giving PAN. How To Claim HRA Tax Benefits

Tax experts say that an employee can still claim tax benefits under HRA in his or her tax return.

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Landlord Not Giving PAN. How To Claim HRA Tax Benefits

House rent paid by employees are exempt from tax to a certain extent under HRA tax benefits.

If the annual rent paid by the employee exceeds Rs 1 lakh per annum, it is mandatory for the employee to report PAN of the landlord to the employer. The tax law also says that in case the landlord does not have a PAN, a declaration to this effect from the landlord along with the name and address should be filed by the employee. Can you claim HRA (house rent allowance) if the landlord is not providing you his/her PAN?  

Tax experts say that an employee can still claim tax benefits under HRA in his or her tax return. 
Even if the employer does not allow HRA exemption to the employee - due to non-availability of PAN or declaration by the landlord for not having PAN, the employee still has the option to claim it at the time of filing the income tax return, says Sandeep Sehgal, director of tax and regulatory at Ashok Maheshwary & Associates LLP. "Once a person is to file his/her income tax return, there is no requirement to furnish the PAN of landlord," he adds.

(Also Read: Fake Rent Receipts For HRA Tax Benefit Will Be Harder To Push Now)

Mr Sehgal however says that the HRA claim could attract scrutiny from tax authorities. "The tax authorities can examine the cases to verify the genuineness of the claim made by the employee," he says.

To substantiate the claim, the employee needs to keep a record of the rent agreement/lease deed, rent receipts, intimation to the society for the occupancy etc., says Mr Sehgal. Also, it is advisable to ensure that the rent payments are made through banking channels as cash transactions may not be considered genuine, he adds.

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