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HRA deduction

Priya (Article in CA firm) (88 Points)

12 February 2019

can assessee claim deduction of HRA if he is residing in a house registered in the name of his mother?

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8 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (174608 Points)
Replied 13 February 2019

Yes, with actual rent paid as per rent agreement; and the rental income offered to assessment by mother.

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Priya (Article in CA firm) (88 Points)
Replied 13 February 2019

sir, even if assessee is paying the loan installments of such house, then also ans would be same or not?

CA.Pankaj Rawat (Chartered Accountant) (1381 Points)
Replied 13 February 2019

he can claim HRA deduction only when actual rent is paid to his mother as per rent agreement.however he can not claim deduction of loan installments because house is register in the name of his mother.

Priya (Article in CA firm) (88 Points)
Replied 13 February 2019

assessee only want to take HRA deduction as he is paying rent as per rent agreement. He doesn't want to take deduction of loan payment as he is neither owner nor co owner of house. My ques is, wil there be any tax consequences becoz assessee has taken loan for such house n paying loan installements therefor, but home is registered in the name of mother i.e owner

CA.Pankaj Rawat (Chartered Accountant) (1381 Points)
Replied 13 February 2019

There will be no tax consequences if he is paying loan installments. (1) Assessee claim HRA for rent paid to his mother.for this purpose rent should be paid through banking channel. (2) Mother of assessee should also file ITR by showing income from house property.

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CA.Pankaj Rawat (Chartered Accountant) (1381 Points)
Replied 13 February 2019

(1) if loan is in the name of assessee and assessee mother than assessee mother will be take the deduction of interest and principle paid from rent received. (2) Assessee will take HRA benefit for rent paid.

Priya (Article in CA firm) (88 Points)
Replied 13 February 2019

okk sir, thanku so much.
I got it.

Essay Bishops (Study Tutor) (22 Points)
Replied 15 February 2019

Unfortunately, one can only claim HRA deduction when actual rent is paid to his mother as per rent agreement/lease agreement. Therefore, he won’t be able to claim deduction of loan installments because house is registered by his mother’s name. Get more insights at my Finance Hub