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Clarification on it tds rule

Samit (Analyst) (42 Points)

28 August 2014

Hello,

It would be very helpful if you can help me with my question below -

To get IT rebate for House Rent, the Income Tax department requires the Rent Receipts and PAN number of Landlord. IT Department does not ask for a rental agreement.

Can my Indian employer ask for a Rent Agreement and deny TDS benefit if I submit Rent Receipts but not Rent Agreement?

Rgds,

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3 Replies

CA Raj Doshi (Practising CA) (8939 Points)
Replied 28 August 2014

A typed written letter SIGNED by the landlord quoting each party, respective PAN and Amount of Rent shall suffice. No requirement of rent agreement. Attach proof of PAN of landlord for verification. That should suffice.

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Samit (Analyst) (42 Points)
Replied 01 September 2014

Thanks a lot Raj.

Now, the problem is - my company has a strange policy. They require Registered Rental Agreement to provide deduction under HRA. I wan't to confront this policy of theirs.

Is any company legally allowed to add their own rules that deals with the IT Benefit for employees? Logically, the company is just a medium and the parties involved are myself and the IT department.

If fortunately, there is any IT Act specifically related to this...pls. let me know.. it would be very helpful.

Regards

CA Gaurav Goyal (CA) (86 Points)
Replied 06 September 2014

Mr Samit,

Dont worry. The portion of HRA wont be much as calculated by the company and on such amount the Income Tax world be even lesser. Let them deduct the TDS but when you file your ITR take it as deduction and claim for IT Refund. Now IT Dept has become very freindly in refunding the tax amount if they found it genuine while processing at CPC.

I think this option will be better and tension-free.