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Submission of PAN Details of Landlord – Is compulsory
For salaried individuals, one of the most common exemption sought is house rent allowance. House Rent Allowance is the allowance given by the employer to employees in order to meet the expenses towards accommodation. If you are paying rent and getting HRA allowance every month, you are eligible for deduction of HRA according to the prescribed limit of HRA exemption.
HRA exemption can be availed up to least of the following:
- Actual HRA received.
- Rent paid – 10% of the salary.
- 50% of salary if house is located in Delhi, Mumbai, Kolkata or Chennai. 40% if house is located in other than these cities.
Submission of Land Lord’s PAN details :
Before the issue of CIRCULAR NO. 8/2013, by CBDT the if the assesses pay Rs. 1,80,000 p.a or Rs. 15,000 per month or above as rent then they have to submit the PAN details f their landlord to employer in order to avail the HRA deduction. But the Above said circular brought by CBDT made it compulsory to submit the PAN details of Landlord if the rent paid is Rs.1 lakh p.a or Rs. 8,333 per month. or above. This rule was brought by Department in order to avoid the submission of fake rental payments to claim HRA.
If Landlord does not have PAN ?
In case the landlord does not have PAN, employee should submit a declaration stating the same along with the landlord’s details. Landlord has to include this rental income while filing his return of income. If he fails to submit the details of this income in the return then he should be ready to face the difficult situations that arise if department comes for scrutiny.
Exception :
However, employees who receive HRA up to Rs. 3,000 per month are not required to submit receipts for proof of rent paid.
Violation of rule causes ?
The documents required to be submitted under this rule should reach the income tax department on or before February month ending of next calendar year. If it’s not the case, the HRA deduction given will be reversed and the entire HRA amount will be added to the total income of assesses.
