Various employees earning on the monthly grounds are often confused that on furnishing the ITR do they claim for the income tax benefit on both House Rent Allowance (HRA) and home loan. On the account of staying on rent but paying for the home loan.
As per the tax and investment experts, people can avail of both the tax advantages if they follow the ITR rules for dual. They commented that the advantages of tax for HRA are a distinct set of rules. Whereas tax relief concerning home loans is another set of rules. The person is entitled to benefit from a home loan and HRA provided they fulfill income tax norms if he is a salaried person and owns a house on the loan but is living on rent.
“HRA benefit is available for salaried earning individuals only under certain conditions. The first and foremost condition is one getting HRA as part of one’s salary, the second condition is the salaried individual paying rent for the home which is occupied by him or her but not owned by him or her. Addressing the income tax rule for claiming tax freedom for one’s HRA Mumbai-based tax expert Balwant Jain said, “. he added that if the salaried individual is providing these conditions then he or she can avail of the income tax advantages for HRA.
Commenting on income tax rules for the home loan benefit Harsh Roongta, Head at Fee-Only Investment Advisers stated that, “Income tax benefit for a home loan can be claimed under two sections. For home loan principal repayment, one can claim benefit under Section 80C, which can’t go beyond ₹1.5 lakh in a single financial year. For home loan interest repayment, one can claim income tax benefit available under Section 24(b).”
For up to Rs 2 lakh home loan interest paid up to two self-occupied properties one could avail of the advantage stated Roongta. Roongta went on to add that the person could avail the income tax benefit on a home loan only when it is owned through earning individuals.
Both Balwant Jain and Harsh Roongta commented that there is no law that says that those who own the house and furnish the home loan cannot avail of the tax advantages for both the home loan and HRA. They commented that the earning people are furnishing these laws for availing the home loan and HRA advantages. They can avail tax advantages for both HRA and home loan
