HRA EXEMPTION

This query is : Resolved

atul (Querist)
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02 April 2009 Dear members
I have some queries that i need to clear to have better understanding and saving tax.

1. ) if the rent agreement is between the husband and landlord, and rent is paid by cheque by wife on her name to land lord, then in this case wife can avail hra exemption or not from her taxable income as she is working in private sector or vice versa? if yes, then what are the document she has to submitt to a/c department?

2. )shall we need to mentioned both husband and wife name in the agreement, so that any one from us can claim full HRA and what doucments we need to give in this.

3. ) shall we need to mentioned both husband and wife name in the agreementas the rent is 12K, where in we received HRA as 5 k and 6 k, can we both share hra claim seperately in our respective organisation and what documents we need to give in this

hope i will get positive answer, this is to plan future tax benefit so that we should not pay high tax to IT Dept.

rgds
Atul

CA.Tarun Maheshwari

CA.Tarun Maheshwari (Expert)
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02 April 2009 The best option is to make rent agreement in the names of both husband and wife, and pay the equal rent by cheque to claim HRA for both. In your first case, if the rent agreement is in name of husband, and payment made by wife, then it will be treated as loan to husband by wife, and no exemption shall be available to her. Only husband would be able to claim. Better is to make a fresh rent agreement in joint names, and pay saperately.