Deductions in respect of rent paid

Deductions in respect of rent paid(80GG)

An individual assessee paying rent for residential accommodation is entitled to deduction u/s 80GG, provided he is not in receipt of House Rent Allowance and Rent Free Accommodation.

Least amount among the following will be allowed as deduction

  • Excess of rent paid over 10 % of Adjusted Total income ;or
  • 25 % of Adjusted Total income ;or
  • Rs 2,000 P.M

Here, Adjusted Total Income means

Less

  • Long term capital gain, if any which have been included in the Gross total income
  • All deductions permissible under section 80C to 80U except 80GG

Deductions u/s 80GG can be availed only if the following conditions are satisfied

  1. Accommodation is occupied for the purpose of his own residence
  2. The assessee ,his wife ,his minor child or an HUF of which he is a member does not own any accommodation at the place where he ordinarily resides or perform duties of his office or employment or carries on his business or profession
  3. Assesse should furnish Form 10BA along with his return of income
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