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HRA related query

nishit (Information Technology Specialist) (28 Points)

08 March 2010

I live in ahmedabad. I have bought flat in 2006-07 and since then i was taking benefit of housing loan principal and intrest payment in my tax returns upto 2008-09. Please note that the house and loan taken on joint name i.e. first my name and second my mother's name. Now in 2009-10, i have decided to move to another rented flat in same city with my spouse and my mother continued to live in the flat which we bought in 2006-07. Hence, i have asked for HRA exemption in 2009-10 but my employer being reluctant to grant that by giving me argument that it is technically not correct. Is this really true ? It is not possible that i should be granted HRA exemption for 2009-10 evenif my mother would take benefit of housing loan principal and intrest payment in her tax return for 2009-10 and not me.

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7 Replies

Hitesh Kothari (Chartered Accountant M.No. - 134239) (326 Points)
Replied 08 March 2010

Hi Nish*t,

Your mother can claim benefit of Housing Loan, interest since it is joint property and your mother should have income to claim the same.

Your employer shoud grant exemption of HRA to you. you show them that i am not residing with my mother, but residing in rented premises which has proper executed agreement and rent payment receipt.

Also before taking benefit of HRA, please analyse the option of not taking the benefit of HRA and continue to claim the benefit of Interest and Housing loan repayment.

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nishit (Information Technology Specialist) (28 Points)
Replied 08 March 2010

Gita Iyer (Specialist) (135 Points)
Replied 08 March 2010

Dear Nish*t,

U can claim HRA as well as Housing Loan repayment and Interest benefit together.......provided u actually stay in rented premises and pay rent!!!

as stated abv.... ur mother can claim HSG loan repayment and interest........and u can also claim HRA!!!

C.Balaji (Learner) (1867 Points)
Replied 08 March 2010

Agree with Gita Iyer.........

You can claim both HRA and Housing loan Interest deduction....

Anshika ( CA -Industry- Sr.Accounts Officier) (141 Points)
Replied 22 March 2010

You can claim HRA showing rent receipt and copy of rent agreement a

nd as well as Housing Loan repayment and Interest benefit

This is completely lawful

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nishit (Information Technology Specialist) (28 Points)
Replied 23 March 2010

Thanks a lot Hitesh, Gita, Balaji and Anshika for your valuable inputs.

I have also tried to dig more on this and it seems that its bit complex to get HRA exemption when you own house in the same city. What i have concluded is that If one claim HRA inspite of owned house in the same city then it can lead A.O. to scrutinize your return and he may ask for further supportings and stuffs and it means unnecessary hassle. There are more chances with the fact in my case that i have not taken HRA exemption in my last two return and was taking housing loan benefits.

Your guidance and input in what i have conluded would be highly appreciated. Should i go for HRA exemption after considering all this?