In order to claim a deduction under Section 80 GG of Income Tax Act, an individual must reside in a property that is rented and must not own any property in the same city. However, an individual will not be able to have a deduction under Section 80 GG of Income Tax Act, if the individual gets a Home Rent Allowance(HRA) by the employer as a part of the monthly salary.

Only salaried and self-employed individuals are eligible to claim a deduction under Section 80 GG of Income Tax Act. Therefore, if an individual owns a business, then he will be eligible to claim a deduction under Section 80 GG of Income Tax Act. Also, those individuals who live on the property of their parents that they own, can also claim tax deductions under Section 80 GG of Income Tax Act. But these individuals need to sign an agreement of rent with their parents and must give rent to them. The rental amount that the parents receive from their kids will be taxed when they file ITR.

Eligibility Criteria to claim deductions under Section 80 GG of Income Tax Act

In order to be able to claim deductions under Section 80 GG of Income Tax Act, an individual must qualify the following given conditions:

• He should either be self-employed or salaried. The deductions under Section 80 GG of Income Tax Act can also be claimed by an HUF. But a business is not eligible to claim the deduction.
• If an employee does not receive an HRA from the employer during the year for which he is claiming a deduction under Section 80 GG of Income Tax Act, then that employee can claim a deduction under Section 80 GG of Income Tax Act.
• If you, your spouse, your minor child or an HUF member does not own any sort of residential property where you can live, or carry out your suits or  business, then you can claim the deductions under Section 80 GG of Income Tax Act.
• If you own a residential property anywhere and your house property is computed under the applied sections, then you will not be able to claim any deductions under Section 80 GG of Income Tax Act.
• If the amount of rent that is paid is more than Rs. 1 lakh per annum, then in order to claim a deduction you will need to submit the PAN Card of your landlord.

Deduction Limit under Section 80 GG of Income Tax Act

The deduction will be considered that value which will be the lowest of all of the listed items:

• Rs. 5000 per month or Rs. 60000 per year.
• Decreasing 10% of the income from actual rent.
• 25% of the total income(except for capital gains in both long term and short term under Section 111A and also income under Section 115A or D song with the deductions under Section 80 C to 80 U. )

How to get and fill form 10BA?

Form 10BA is nothing but a declaration that needs to be filed by an individual who wishes to claim a deduction under Section 80 GG of Income Tax Act for the rent that is paid on the property of rent. This declaration states that you are not enjoying the benefit of self-occupied property on that house in either the same or a different location.

It is quite easy to get a Form 10BA. An individual can get Form 10BA directly from the HR department of the concerned company or from tax offices. It can also be easily downloaded online from the Income Tax Website.

The details that are necessary in order to file form 10BA are as follows:

• PAN Card and Name of the Assessee
• Complete Address of the Assessee
• Time period and amount of rent
• Payment method for paying rent
• Name and Address of the property owner
• PAN of the owner in case the rental amount is more than Rs. 1 Lakh.
• A declaration which states that the assessee does not own any other house-property either himself or in the name of a minor child/spouse or any other member of the HUF.

Claiming the Deductions under Section 80 GG of Income Tax Act

It is possible for any individual to claim a deduction under Section 80 GG of Income Tax Act at the time of filing the ITR if the following conditions are satisfied by them:

• They should be making rent payments for the property on which they are currently living.
• They must not own or possess any property in the same city or the same location as their workplace. In case an individual owns a property but lives on rent in the same city, then that person will not be eligible to claim a deduction under Section 80 GG of Income Tax Act.