ITR AY 2026-27: How Non-Salaried Individuals Can Claim Rent Deduction Under Section 80GG?

House Rent Allowance (HRA) is a component of an employee's salary provided by employers to help cover the cost of rented accommodation. Under Section 10(13A) of the Income Tax Act, a portion of the HRA received by salaried employees can be claimed as tax-exempt, subject to prescribed conditions. However, this benefit is available only to those who receive HRA as part of their salary package and opt for the old tax regime while filing their Income Tax Return (ITR).

But what if you are self-employed, a freelancer, or a business owner and do not receive HRA? In such cases, you may still be eligible to claim a deduction on rent paid under Section 80GG of the Income Tax Act.

Who Can Claim Deduction Under Section 80GG?

An individual can claim a deduction under Section 80GG of the Income Tax Act, 1961 (or the corresponding provision under the Income Tax Act, 2025) if all of the following conditions are satisfied:

•The individual does not receive House Rent Allowance (HRA) from an employer.
•The individual pays rent for residential accommodation occupied by them.
•The individual, their spouse, minor child, or Hindu Undivided Family (HUF) does not own a residential house in the city where they ordinarily reside or work.
•The individual files Form 10BA along with the income tax return.

How Is Deduction Under Section 80GG Calculated?

The amount eligible for deduction is the lowest of the following three amounts:

1.Rs 5,000 per month (Rs 60,000 per year).
2.25% of the total income before allowing deduction under Section 80GG.
3.Actual rent paid minus 10% of the total income before allowing deduction under Section 80GG.

How To Claim Deduction Under Section 80GG?

To claim the deduction, taxpayers must provide the following details while filing their return:

•Full name of the taxpayer.
•Permanent Account Number (PAN).
•Complete address of the rented residential property, including PIN code.
•Name and address of the landlord.
•Landlord's PAN details.
•Duration of stay in the rented accommodation.
•Amount of rent paid and mode of payment (cash, bank transfer, cheque, etc.).
•A declaration in Form 10BA confirming that neither the taxpayer nor their spouse, minor child, or HUF owns any residential property at the place of residence or employment.

Form 10BA: Mandatory Requirement For Section 80GG

Form 10BA is a mandatory declaration that must be submitted to claim a deduction under Section 80GG. The form must be filed online on or before the due date for filing the Income Tax Return (ITR).

Details Required In Form 10BA

Taxpayers must furnish the following information in Form 10BA:

•Name and PAN of the assessee.
•Residential address of the assessee.
•Period for which the rented accommodation was occupied.
•Amount of rent paid.
•Mode of rent payment.
•Name and address of the landlord.
•Landlord's PAN, if annual rent exceeds Rs 1 lakh.
•A declaration confirming that neither the taxpayer, spouse, minor child, nor the HUF of which the taxpayer is a member owns any residential property in the place where the taxpayer resides or works.