Exemption of House Rent Allowance
Get Rid of QUALIFYING FOR A TAX ,A salaried individual having a rented accommodation can get the benefit of HRA (House Rent Allowance). This could be totally or partially exempted from income tax. However, if you aren’t living in any rented accommodation and still continue to receive HRA, it will be taxable.
Get Rid of QUALIFYING FOR A TAX
If you couldn’t submit rent receipts to your employer as proof to claim HRA, you can still claim the exemption while filing your income tax return. So, please keep rent receipts and evidence of any payment made towards rent. You may claim the least of the following as HRA exemption.
a. Total HRA received from your employer
b. Rent paid less 10% of (Basic salary +DA)
c. 40% of salary (Basic+DA) for non-metros and 50% of salary (Basic+DA) for metros
Many systems, including the United Kingdom, levy tax on all chargeable “profits of a trade” computed under local generally accepted accounting principles (GAAP). Under this approach, determination of whether an item is deductible depends upon accounting rules and judgments. By contrast, the U.S. allows as a deduction “.
All the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business…”subject to qualifications, enhancements, and limitationsA similar approach is followed by Canada, but generally with fewer special rules. Such an approach poses significant definitional