House Rent Information

How to Enter House Rent Information?

Click on the "Rent Details" tab for submitting house rent information. Once you click on the Rent Details tab, you can see the table titled "Rent details for House Rent Allowance exemption."

As soon as you click on the  icon on top-left in the table, you will see a row with blank fields where you can enter details of house rent that you have paid or will be paying for the year. Please click on the respective cells to update the required details.

The default "From" field value is April 1 of the current tax year. If you wish to change this value, click on the cell and use the calendar that pops-up. The "from" date value has to fall within the financial year (April to March) to which the declaration pertains.

In order to enter the "To" date value, click on the cell and use the pop-up calendar. The "To" date has to fall within the financial year (April to March) to which the declaration pertains. 

Please enter the rent amount paid for the accommodation in the "Rent Paid" field. Click on the field and use the input box which pops up. The entry has to be a number with a maximum of two decimal places.

"Property Address" - Please enter the address of your rented accommodation.

"Landlord Details" - Please enter the name and address of your landlord.

In case your annual rent amount is more than Rs 1 lakh, you should enter landlord's PAN/Aadhaar.

You can create as many rows as you wish to enter rent details, in case of change in accommodation or rent during a year, by clicking on the icon.

Please note that you should not enter monthly or quarterly rent information but enter information as per the dates during which you occupied the accommodation.

Example 1

In the year 2023-24, if you stayed in two houses, stated as follows:

House 1: From June 1 to July 15 – Rs 6000 per month is the rent. You paid Rs 9000 since you stayed in the house for a month and half.

House 2: From July 16 to July 31 – Rs 10, 000 per month is the rent. You paid Rs 5000 for the 15 days from July 16 to July 31, 2023.

Then please DO NOT enter the information, by splitting the rent paid into monthly periods, as follows:

Instead, the correct entry is as follows.

HRWorks, on the basis of the dates of accommodation, will calculate the HRA exemptions for adjustments in your gross pay.

Example 2:

If you stay in one house in a metro city for the whole year (April 2023 to March 2024) by paying Rs 10,000 per month as rent then there should be only one entry as follows.

Even if you stay in one house for the whole year and if there are rent revisions during the year, you will need to make different entries for each revision. For example, in the year 2009, if you stayed in only one house, but the rent was revised as follows,

House 1: From Apr 1, 2023 to Sep 30, 2023 – Rs 6000 per month is the rent. You paid Rs 36,000 since you stayed in the house for 6 months.

House 1: From Oct 01, 2023 to March 31, 2024 – Rs 10, 000 per month is the rent. You paid Rs 60,000 for 6 months.

Then please do not enter the information, by making just one entry, as follows:

Instead, the correct entry is as follows.

HRWorks, on the basis of the dates of accommodation, will automatically calculate the HRA exemptions for adjustments in your gross pay.

Every time you submit a new declaration, you can choose to change the rent details as you wish. However, please note that amounts in the rent receipts (whether monthly or any other periodicity), should equal amounts entered in the tax declaration whenever you submit rent receipts to your organization.

How is Tax Exemption for House Rent Allowance (HRA) Calculated?

As per the Indian income tax law, the following is the exemption calculation in respect of HRA received.

The least of the following is exempted:

1. Rent paid in excess of 10% of basic salary;
2. Actual HRA received;
3. 40% of basic salary (if the house is located in a non-metro area) or 50% of basic salary (if metro).

Please note that in order to avail HRA exemption:

• The rented property must not be owned by you. In other words, you cannot pay rent to yourself in order to avail HRA exemption.
• Rent must be paid by you. In other words, you cannot claim exemption on rent payments made by others.

As per the logic that drives HRA exemption calculation in HRWorks, whenever any of the above parameters (Basic pay, Rent paid, HRA, Metro or Non-metro) changes for an employee during a year, the HRA exemption is calculated. In other words, a year is divided into as many periods as dictated by changes in any of the above parameters, and HRA exemption is calculated for each of the periods. Finally, the HRA exemption amounts for the different periods are aggregated to compute the HRA exemption amount for the year.

Please take a look at our blog post for more information on HRA exemption calculation - https://www.hinote.in/house-rent-allowance-hra-exemption. 

Proof Submission for Payment of House Rent

Towards the end of a year or when you leave your organization, please submit the original house rent receipt as proof of having paid rent for your house, to your organization. The format of the rent receipt should be as per your organization's instructions.