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Now use landlord’s PAN to claim tax exemption on HRA!

Salaried taxpayers, who want to claim I-T exemption on house rent allowance exceeding Rs. 1 lakh per annum, will have to obtain the PAN card number and other details of their landlord on a plain A-4 size paper before submitting it to their employer.

A number of tax department officials spoke to agencies saying the circular does not state that such a document has to be a ‘sworn affidavit’ or a ‘notarised document’. Hence, an individual should obtain the information from his or her landlord on a simple plain A-4 size paper.

The tax returns and exemptions filing season will gather momentum in the coming days as the financial year closes on 31 March (2013-14).

‘The department has a number of technical platforms to check the authenticity of this information that is provided to it by a salaried taxpayer. The circular has not stated explicitly about the kind of document so it is considered that a plain piece of paper would do,’ a senior department officer said.

The income tax department will require this document to enable exemption for a taxpayer under house rent allowance (HRA) after the central board of direct taxes (CBDT) issued a circular in this regard in October last year.

The circular (08/2013) states, ‘An employee claiming exemption from tax with respect to house rent allowance received is now required to report the PAN of the landlord to the employer, if the rent paid by the employee to the landlord exceeds Rs. 1 lakh per annum, along with the rent receipt.’

It further adds, ‘In case the landlord does not have a PAN, a declaration to this effect from the landlord along with the name and address of the landlord should be filed by the employees.’
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