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Deduction in respect of Rents Paid [Section 80GG]

  1. Essential Conditions for claiming deduction under Section 80GG :

  2. Quantum of Deduction under Section 80GG :

1. Essential Conditions for claiming deduction under Section 80GG :

  1. Only an individual can claim deduction under section 80GG.

  2. The individual should pay rent for his residential accommodation, whether furnished or unfurnished.

  3. The individual is either a self-employed person or if he is an employee, he is neither entitled to any house rent allowance nor a rent-free accommodation.

  4. The individual, his or her spouse or minor child or a HUF of which he/she is a member, does not own any residential accommodation at the place where such an assessee ordinarily resides or at the place where he works or carries on his business or profession.

  5. If the assessee i.e. the individual owns any residential accommodation at any place, other than the place of residence or work of the assessee, then such property should not be assessed in the hands of the individual as self-occupied property.

  6. Only an individual who pays rent for a residential accommodation for himself (and family) can avail deduction under section 80GG provided he gives a declaration electronically in Form No. 10BA.

2. Quantum of Deduction under Section 80GG :

The deduction shall be the minimum of the following amounts:

  1. Excess of rent paid over 10% of 'Adjusted Total Income';

  2. 25% of the "Adjusted Total Income";

  3. Rs. 5,000 per month.

Adjusted Total Income :

Adjusted Total Income, for this purpose, means the "Gross Total Income" as reduced by:

  1. Long-term capital gains if any, which have been included in the "Gross Total Income";

  2. Short-term capital gains of the nature referred to in section 111A (i.e. short-term capital gain on transfer of shares through a recognised stock exchange which are taxable @ 15%);

  3. All deductions permissible u/ss 80C to 80U excepting deduction under this section i.e. section 80GG.

  4. Income referred to in section 115A, 115AB, 115AC or 115AD. These sections relate to incomes of NRIs and foreign companies etc. which are taxable at special rate of tax.

Deductions to be made in Computing Total Income [Sections 80A to 80U (Chapter VIA)]

Related Topics...Deductions from Gross Total Income

  1. DEDUCTIONS UNDER 'CHAPTER VI-A' IN RESPECT OF "PAYMENT & INVESTMENT" ARE ALLOWED FROM SECTION 80C TO 80GGC

    Section 80C Section 80CCC Section 80CCD
    Section 80CCG Section 80D Section 80DD
    Section 80DDB Section 80E Section 80EE
    Section 80G Section 80GG Section 80GGA
  2. DEDUCTIONS UNDER 'CHAPTER VI-A' IN RESPECT OF "INCOMES" ARE ALLOWED FROM SECTION 80-IA TO 80U

    Section 80-IA Section 80-IAB Section 80-IAC
    Section 80-IB Section 80-IBA Section 80-IC
    Section 80-ID Section 80-IE Section 80-JJA
    Section 80-JJAA Section 80-LA Section 80-P
    Section 80-PA Section 80-QQB Section 80-RRB
    Section 80-TTA Section 80-TTB Section 80-U
 

 

 
 
 
 
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