How to claim tax Deduction on rent paid – Section 80GG

If you are not receiving house rent allowance from your employer or your salary does not include house rent allowance then you are eligible to claim tax deduction for your house rent expense that you incurred for your living during the previous year.

Under section 80GG of income tax act, 1961, a self employed person, businessman and even a salaried person can claim tax deduction for the expenses that they incur towards there house rent.Income Tax Deduction for non receipt of HRA - Section 80GG

Limit of Tax Deduction for House Rent paid – Section 80GG

Tax deduction under section 80GG of income tax act, 1961 is allowed to the extent of the least of following;

  • Rent paid in excess of 10% of total income
  • 25% of total income
  • 2, 000 rupees per month (Budget 2016-17 proposed to increase this limit to Rs 5000)

For the calculation of deduction for house rent, total income will be calculated after reducing your tax deduction under different section of chapter VIA except section 80GG, long term and short term capital gain.

If finance bill of Budget 2016-17 passed then you can claim deduction of Rs 60000 under section 80GG for the rent paid instead of earlier limit of Rs 24000.

Conditions to claim deduction under section 80GG for house rent

To claim deduction under section 80GG of income tax act, 1961 you need to fulfill following conditions;

  • You should not own a house in the place in which you live, or work or carry on business
  • Your spouse, child including minor child, Hindu undivided family should not own any residential accommodation in that place
  • You must file a declaration in form no 10BA by confirming that you paid the rent and fulfill the conditions to claim deduction.
  • If you are a salary person then you should not be in receipt of house rent allowance
  • You must reside in that house to claim exemption. Any one with you can also stay with you for the purpose of claiming this deduction under section 80GG.

If you are owning a house in some other city and use that house for your own resident and not given for rent then you can not claim deduction under section 80GG even though you stay in a rented house and pay rent at your work location in a different city.

Any one living in a rented accommodation can claim a maximum deduction of Rs. 24000 (2000*12) if he is not in receipt of house rent allowance and does not own any house at the place of living.

17 thoughts on “How to claim tax Deduction on rent paid – Section 80GG

  1. Sunny

    I am self employed and can claim tax exemption under Sec 80GG. But regarding Form 10BA to whom or which Govt authority have we to submit this declaration?
    Await your valued reply pl.

    Regards

    Reply
  2. Vishant

    same in my case. I have earning 34.5K per month and paying 14.5K as house rent. How to put this under tax rebate and whom and when to submit 10BA form

    Reply
  3. uttam

    me siksha karmi 02 me hu meri monthly income 28500 he mujhe hra nahi milta tax bachane me life kya karu

    Reply
  4. Shashi Kumar Pandey

    if you live in rent then you can claim deduction under section 80GG. or you can choose another options for your tax benefit.

    Reply
  5. Rohit

    I am state goverment employee reecive hra , live at rented house can i claim tax deduction under head rent paid 80GG .HOW MUCH Deduction can i claim ,i pay 5000 rent per month.

    Reply
  6. P.K.Acharya

    Useful for Pensioners. I want to take a copy. Our Treasury i.e. Dist Treasury Khurda,Bhubaneswar, does not appear to know this Act. When I cited this in my Assessment, they asked me for a copy of this rule.Very strange?

    Reply
  7. MADAN LAL ARORA

    Sir, I am retired from a bank and getting pension of Rs.27324/-. Since I am not having a house anywhere in India and presently paying a rent of Rs.16500.00 per month in Delhi, i humbly request you to please guide me as under:
    1. Whether I can claim any rebate under section 80GG for the A.Y. 2016-17?
    2.. How much rebate will I be entitled to for A.Y. 2017-18?

    Reply
  8. ravi

    I am govt employ i am living in mumbai in govt bachelor accommodation. My undivided family living in delhi in private rented accommodation. Shall i get tax deduction under section 80 gg.

    Reply
  9. K RAVINDRANATH PAI

    I am a retired Bank Officer aged 66 years drawing pension from my Bank I do not own nor my spouse nor my children own a house anywhere including the place where I live in. I am staying in a rented flat paying
    rent and maintenance charges out of my monthly pension. Am I eligible to claim deduction out of my
    income chargeable to tax

    Reply
    1. yegna

      I am a bank pensioneer, aged about 71 yrs & geting an income of rs360000 p a & including pension & after deducting deductions u/s 80. I am not owing a house. Am I eligible for house rent of rs 2000 p m for the financial 2015-16?

      Reply
  10. Tap

    Sir,

    I work in a PSU and stay in company provided quarters. However a amount of around Rs10000/- mper month is showed as perquisite in form 16. Am I eligible for deduction under section 80GG

    Reply
  11. Pawan

    Company is provided accommodation in their township at concessional rent deducted from salary. and all other conditions as given in u/s 80GG is applicable. Can we claim deduction u/s 80 GG.

    Reply
  12. Ashok S

    I’m a teacher with an annual income of about 350000/-, HRA paid is only 12,000/- (annual). I stay in a rented property paying about 10,000/- per month. Can I make use of 80GG to save some Tax? Kindly advice.

    Reply

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