Income Tax Sec 80GG for Old Tax Regime FY 2023-24

Deductions under Section 80GG

To qualify for deductions related to rental expenses under Section 80GG, you must meet the following conditions:

• Must be an individual or a United Hindu Family (HUF). This means that businesses are not eligible to claim rental deductions.
• It is necessary to be self-employed or salaried. If you are neither, you cannot claim rental deductions under this section.
• You should not receive HRA benefits on your wages. If you do receive HRA benefits, you cannot claim deductions under Section 80GG.
• You must complete and submit Form 10BA, which declares that you are not claiming the Self-Occupied Property benefit in a home elsewhere or in the same location where you are employed.
• If your annual rent payment exceeds Rs. 1 lakh, you must provide the PAN card of the owner of the house where you reside for rent.
• You can claim rental deductions even if the house you are renting is semi-furnished or fully furnished.

Under Section 80GG, you can claim deductions for rental expenses based on the lesser of the following amounts:

• Rs. 60,000 annually (or Rs. 5,000 per month)
• The amount equal to the total rent paid minus 10% of your total income
• 25% of your annual salary

You can choose the lowest amount from the above options to claim as a deduction for rental expenses under Section 80GG.

Exceptions under Section 80GG

There are certain circumstances in which you cannot claim a deduction for rental expenses under Section 80GG. These include:

• If you own a home where you are employed or run a business, you cannot claim a deduction for rental expenses.
• If you are already claiming benefits for owning a home elsewhere as self-occupied property, you cannot claim a deduction for rental expenses.
• If you live in one city but own a house in another city/town, it will be considered rented and you may be eligible to claim a deduction for rental expenses under Section 80GG.