HRA Claim Mistakes: Many mistakes can happen while claiming HRA, which should be avoided otherwise you will not be able to get the full benefit of this tax exemption component.
The financial year 2024-25 is going on and the filing of income tax returns has also started. The Income Tax Department has released the ITR forms. Apart from this, employers have sent information to their employees to give investment declaration and this process is going on in many institutions. There is also a discussion among the people regarding the selection of New Tax Regime and Old Tax Regime and taxpayers also have many questions in their minds about which tax regime should be used for filing income tax returns.
Mistakes in claiming HRA can cost you heavily
In the old tax regime, people filing income tax returns are required to provide investment proof and a major component of this is HRA i.e. House Rent Allowance. By claiming HRA, a large section of the salaried class tries to save their tax, for which they usually claim HRA by submitting rent slips. However, to claim HRA, many times employees resort to such proofs in return of which the employer can reject the claim. Keeping this in mind, we are telling you what things should be kept in mind which you should avoid.
Also Read: UIDAI issues 4 types of Aadhaar cards, which format of Aadhaar do you use?
Avoid these mistakes while claiming HRA
Do not rely only on rent receipts Often employees submit rent receipts from their office to claim HRA. These do not guarantee exemption from tax deduction under any circumstances and apart from these, you should also submit some solid documents in your favor like bank account details etc.
Lack of rent agreement can create problems
Many times, to claim HRA, employees mention their parents, brother or any other relative etc. and say that they have not made a rent agreement. If the matter is ever investigated and the rent agreement is not found, then your HRA deduction may be rejected.
Paying in cash can give you a headache
If you have paid the landlord in cash and you do not have proof of it (not even a receipt) then your HRA claim may be rejected. You should always transact the rent in the landlord’s bank account instead of paying in cash and you should have a bank statement mentioning this.
