Section 80GG of Income Tax Act

Under this section, one can claim for deduction for house rent allowance. If an individual does not get HRA from the employer and the individual has borne the rental expenditure for either a furnished or an unfurnished accommodation then one can claim for deduction under Section 80GG towards payment of rent.

One has to fulfil the following list of conditions to become eligible under Section 80GG

• One should be either a salaried employee or self-employed.
• One should not have received HRA at any point during a financial year for which one is claiming deduction under Section 80GG.
• The individual or their respective spouse or minor child or Hindu Undivided Family of which the individual is a member do not own any of the residential accommodation at the place where they currently reside, perform duties of the office or carry out any of the business or profession.
• In case if an individual owns any residential property at any of the places for which income from the house property is calculated under applicable sections (as a self-occupied property), then no deduction under Section 80GG is allowed.

Exceptions Under Section 80GG

An assessee cannot claim a rebate on house rent if the location of the house is situated where he/she is either employed or operates the business. If an individual is staying in one city and has a house which is located in another location and the latter house will be considered as rented out.

If an individual is staying in his/her parent's house, then he/she can claim the benefit of rent deduction as per the Section 80GG. He/she will have to make a rental agreement with their respective parents in order to be eligible for rent deduction. The parents whoever owns the house on their part have to show the rent as income from their tax returns.