Income Tax: One thing to keep in mind is to file ITR before the last date. If you want to claim HRA by getting a rent agreement made in the name of your wife, then do not miss this information.
Income Tax Saving: The last date for filing income tax returns is 31 July 2024. Tax payers are filing returns to get quick refunds and avoid last minute rush. For this, they can adopt various strategies to save tax. Tax can be saved by putting money in investment schemes like National Pension System (NPS), Employees Provident Fund (EPF), Equity Linked Savings Scheme (ELSS), Post Office Senior Citizen Savings Scheme (SCSS), and Fixed Deposit (FD). Investing in these schemes can save up to ₹ 1.50 lakh in a financial year.
Another effective way to save tax is house rent allowance or Housing Rent Allowance (HRA). You can keep your money at home even by paying rent to your wife. By doing this, you can save tax on an amount of up to Rs 1 lakh 80 thousand. However, for this you will have to get a valid rent agreement made with your wife. The amount of rent and other terms should be clearly written in this agreement.
HRA Claim: Note these things
Let us tell you that you can get the rent agreement made from any court, which should have the seal and signature of the notary. Rent under HRA has to be paid through bank transfer or cheque, so that you have proof of payment. By doing this you can save a lot of tax and the money will also remain in your house.
To claim HRA, first verify the amount of HRA given by your employer. Then calculate the rent paid and deduct 10 percent of your basic salary to determine the remaining amount. If you live in a metropolitan city, you can claim 50 percent of the rent paid, while in a non-metropolitan city it is 40 percent.
This way you can save tax on Rs 1,80,000
For example, suppose your monthly income is ₹1,00,000. This includes HRA of ₹20,000. You pay monthly rent of ₹25,000 to your wife. Accordingly, the annual HRA will be ₹2,40,000, annual rent payment ₹3,00,000, and 10 percent of basic salary will be ₹1,20,000. In this case, you can claim tax-free HRA up to ₹1,80,000 in the metropolis.
While claiming HRA, make sure that the rent agreement is valid, and no fraud has been done in making it. Pay the rent only through bank statement or cheque, so that you have the details of the payment. Apart from this, also ensure that your wife also files income tax return.
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