Monday, October 21

HRA Exemption - Disclose PAN of landlord if rent exceeds Rs 1 Lakh

It was only recently that the Central Board of Direct Taxes (CBDT) had required that salaries employees claiming HRA need to furnish the PAN details for their landlords in case the rent paid per month was Rs 15000 or more.

The CBDT has found yet another means to increase the disclosure burden on salaried individuals by amending the requirements to Rs 100,000 per year, effectively decreasing the above limit to Rs 8,333 per month. Thus, for every employee whose total rent in a year exceeds of Rs 1 lakh per year, he will have to furnish the PAN of the landlord. In case the landlord does not have a PAN, the assessee must submit a declaration to this effect from the landlord along with the name and address of the landlord. This should be filed by the employee.

While this will put a check on the individuals claiming higher House Rent Allowance (HRA) exemption by showing fake receipts, it will unnecessarily increase the difficulties for honest tax payers as landlords are usually reluctant in disclosing their PAN numbers on rent receipts.

This is seen as yet another move from the government who is chasing easy targets to collect higher tax revenues than more difficult ones to check the revenue leakage. However, the efforts have been paying off as the total direct collections of the government has gone up 10% in the current fiscal so far (April to September 2013) to Rs 3.0 lakh crore from Rs 2.7 lakh crore same period last year.

Source:: The Economic Times.


  1. hi Vikash, Can you please help that from when is this new rule applicable? is it from April 1st 2014 of effective Novemeber 1st 2013.

  2. Vikash Ji, may we know in what format/ document required the declaration. For example on plane paper (with / without ID Proof, rent agreement, etc.).