80GG Tax Rebate

Ensuring that citizens have access to quality housing is one of the responsibilities of the government. Most salaried people get tax exemption on the HRA part of their salary. But if you do not receive HRA from any source you can still get tax rebate for the rent you pay under section 80GG.

Eligibility for 80GG tax rebate

If you are a salaried individual, a self employed person or an HUF you can get deduction under section 80GG on the rent you pay if you satisfy the following conditions:

- More than 10% of your annual income is spent on rent.

- Neither you nor your spouse or a minor child owns a house at the place where you are ordinarily residing.

- If you own a house at any other place you have not been claiming tax concession on income from that house (making annual value of it nil for  computing income from house property).

You would have to submit a declaration in form 10BA and enter amount while filing Income Tax Returns in order to claim this tax deduction.

Maximum deduction limit under 80GG

The least of the following three can be claimed: 

- Rs 2,000 per month 

- 25% of total income (total income except from long term capital gains and after all chapter VI A deductions have been accounted for, except 80GG, of course) 

- Actual rent minus 10% of total income (calculated as above)

How to get tax rebate on house rent in absence of HRA

Put the amount in the cell for 80GG under Chapter VI-A deductions in ITR form while filing income tax returns. If you are salaried you can submit rental receipt to HR so that they deduct the amount while applying TDS on your salary, for 8GG deduction.

Fintotal comment

If you are living in a rented place away from home due to employment or business related reasons and have no HRA, make full use of the tax rebate under section 80GG. For those living in urban or semi-urban areas this is a dud- hardly offers any relief- but would you want to let a tax rebate go waste?


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