The Finance Ministry has changed the rules related to House Rent Allowance (HRA) for central government employees. According to the new rules, government employees will not be eligible for HRA in certain cases.
The Finance Ministry has changed the rules related to House Rent Allowance (HRA) for central government employees. According to the new rules, government employees will not be eligible for HRA in certain cases. In such a situation, if you are an employee of the Central Government, then you should know what these conditions are. Let us know them in detail.
New conditions for House Rent Allowance (HRA)
1. The first rule is that if the employee shares the Government accommodation allotted to another Government employee, he will not be eligible for the same.
2. Apart from this, if the parent, son or daughter of the employee has been allotted a house by any of them and he is living in it. These include Central or State Government, Public Sector Undertaking and Semi-Government Organization like Municipal Corporation, Port Trust, Nationalized Bank, LIC etc.
3. If the spouse of the Government servant has been given a house by any of the units mentioned above. And even if he is living in that house or living on a separate rental, he will not qualify.
What is HRA and who can claim it?
HRA, which is called House Rent Allowance, is a major part of your salary. If a salaried individual lives in a rented house, then he gets tax exemption on it. Your employer decides how much HRA you will get, but there is scope for optimization.
HRA claim can only be made by salaried individual. Self employed cannot claim HRA. The house in which the salaried individual is staying should be on rent. You don’t get the benefit of living in your own house. Rent should be more than 10% of your salary only then it can be availed. Along with this, the rent cannot be given to the husband or wife.
There are three main conditions regarding how much HRA can be claimed. The first condition is that deduction cannot be availed more than the amount of HRA received. For metro cities, it can be 50 percent of the maximum basic and dearness allowance. According to the third condition, the amount of rent paid by you minus basic salary and dearness allowance cannot be claimed more than 10 percent.
