claim of HRA both husband and wife

[hanamantharao kulkarni]

Dear Sir

I request you to give me suggestions regarding house rent allowance.

1. Is it fully exempted for income tax 

2. can both husband and wife claim exemption if they are in government service

[A Wilson]

Dear Sir,

HRA Exemption is available only if you have House Rent Allowance and rental payments.

House Rent Allowance & Rental Payments :

HRA exemption is available subject to the following conditions:

A. For Metro Cities - Delhi, Mumbai, Kolkata, Chennai

Least of the Following will be exempted

1.     50 percent of Basic Salary

2.     Actual HRA Received

3.     Rent Paid minus 10 percent of the Basic Salary

B. For Other Cities – other than Delhi, Mumbai, Kolkata, Chennai

Least of the Following will be exempted

1. 40 percent of Basic Salary
2. Actual HRA Received
3. Rent Paid minus 10 percent of the Basic Salary

And You can claim the HRA Exemption to the extend of the rental payments subject to the conditions stated above. Double claim by you and your spouse will not be allowed. But you both may claim HRA Exemption in proportionate with the rental payments (eg) If the total rental payment is Rs.10000/- p.month, then you may claim 50 percent and your spouse may claim another 50 percent subject to the limit specified above.

Thanks & Regards,

A.Wilson

AI Summary

HRA exemption depends on salary based threshold, actual HRA received and net rent paid; spouses may split the claim. HRA Exemption applies only if HRA is received and rent is paid; the exempt amount is the least of a salary based percentage threshold (higher for metros), actual HRA received, and rent paid minus a salary linked minimum. Spouses cannot both claim exemption on the same rent beyond the actual rental payments; they may claim proportionate shares of the rent paid subject to the measurement rules.