Should HRA tax exemption be allowed on rent paid to spouse?
Today’s newspaper carries an article with details of a ruling in favour of a husband who paid rent to his wife with whom he was staying, and claimed HRA tax exemption. This had been earlier rejected by the IT authorities and prompted the claimant approach the Tax Appellate Tribunal.
HRA and its tax impact
House Rent Allowance or HRA is one of the main salary components of an individual. A salaried employee staying in a rented house can claim HRA from his employer and avail of an income tax exemption under section 10(13A) of the income tax act.
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