Produce PAN of landlord on plain A4 sheet for claiming HRA exemption

Updated: Saturday, January 11, 2014, 13:17 [IST]

As the financial year is set to close on March 31, 2014, for claiming tax exemption on house rent allowance (HRA) in excess of Rs. 1 lakh in a year, all salaried employees are now required to obtain PAN number along with other relevant details of the landlord and produce it before the employer. As per the officials of the tax department, the document to be provided has not to be a notarised document or an affidavit and the details can be obtained on a simple A-4 sheet from the landlord.

The amount of tax exemption granted on HRA is determined on the basis of the rent paid by the employees in a given financial year.

The notification concerning tax exemption in respect of HRA was earlier intimated via a circular of the Central Board of Direct Taxes (CBDT) last year which stated that "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."

The circular also suggested the recourse for the salaried taxpayer intending to claim tax exemption on HRA in case the landlord does not possesses the Permanent Account Number (PAN). In this case, a declaration in respect of the landlord not bearing the PAN number together his name and address has to be obtained from the landlord and filed with the employer.

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