Important Alert: Income Tax Department Warns Tenants to Keep Rent Agreement and Receipt Ready for HRA Claim
The Income Tax Department has issued a warning to tenants claiming House Rent Allowance (HRA) to keep their Rent Agreement and receipt ready. The department is conducting random scrutiny and will send Income Tax Notice if there are any irregularities. If the tenant is unable to provide proof, their claim may be rejected, and they may face hefty fines.
Here are some important points to keep in mind:
• Always keep the Rent Agreement and receipt ready for HRA claim.
• If the claim turns out to be fake, a hefty fine may have to be paid.
• If the amount of rent and receipt does not match, the HRA claim will be canceled.
• The investigating officer has the right to impose a penalty of up to 50 percent for wrongly showing the income in the income tax claim.
• The department can impose a fine of up to 200 percent if the income has been shown less or any other mistake has been made in it.
• The Income Tax Department verifies the rent receipt in different ways, including checking the amount given in the rent agreement and the PAN of the landlord.
• HRA is taxable but can be exempted from taxes subject to certain conditions and limits prescribed by the Income Tax Rules.
Tenants claiming HRA must ensure that they have all the necessary documents to avoid any kind of penalty or fines. The Income Tax Department is keeping a close eye on the matter, and it is essential to comply with the rules and regulations to avoid any issues.
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