House on Rent – Remember to ask for the Landlord’s PAN first

We judge a house on several parameters before taking it up on Rent. We get the rent agreement in place and ensure rent receipts are provided too. A very important aspect is to obtain the Landlord’s PAN.

The Income Tax Department has laid down (via CBDT circular 8/2013 dated 10th October 2013) that

Where the annual rent paid is more than Rs 1,00,000 per annum – It is mandatory to report the PAN of the Landlord to the IT Department to claim HRA exemption.

In case the Landlord does not have a PAN – one must obtain a declaration to this effect from the Landlord with name and address of the Landlord.

An annual rent of Rs 1,00,000 works out to Rs 8,333 per month – therefore if you are taking a house on rent and ma king a payment exceeding Rs 8,333 per month – Remember to obtain the landlord’s PAN or you may lose out on the HRA exemption. In case the landlord does not have a PAN they must be willing to give you a declaration. So add it to your home renting checklist!

Do note that salaried employees earning HRA up to Rs 3,000 per month are exempt from production of rent receipts. Though – we highly recommend you to keep those for your own record.

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