Section 80GG of Income Tax Act – Rent Paid.

If you don't receive HRA (House Rent

Allowance) but pay rent, you can still get a tax deduction on the rent paid under Section 80
GG of the Income Tax Act, 1961. The maximum deduction permitted under Section 80
GG is Rs 60,000 per annum (Rs 5,000 per month).

Section 80GG - Deduction for Rent Paid

Eligible Individual or HUF, self employed or salaried not receiving

Assessee HRA at any time during the year.

1. The Assessee, his/ her spouse, minor child or HUF of

which he is a member shall not own any residential
accommodation at a place where he currently resides, is
currently employed or carrying on business or
profession.
Conditions
2. If the Assessee owns any residential property at any
other place then the same should not be assessed as
self occupied residential property.
3. The Assessee must be paying rent.

The deduction will be lowest of:

Amount of 1. Rs. 5,000/- per month

Deduction 2. 25% of Adjusted Total Income
3. Rent Paid Less 10% of Adjusted Total Income

Adjusted Total Income means Income excluding:

Meaning of 1. Long Term Capital Gain

Adjusted Total 2. Short Term Capital Gain under 111A or section 115D
Income 3. Deduction under section 80C to 80U

Also deduction under section 80GG is to be excluded.

Other The Assessee needs to file Form 10BA containing details of

requirements payment of rent.

Mr. A pays a rent of Rs. 10,000/- per month. His total income
before deduction under section 80GG is Rs. 4,80,000/-. The
deduction that will be allowed to him under section 80GG will
be as follows:
Example
1. Amount calculated at Rs. 5,000/- per month = Rs.
60,000/-
2. 25% of Total Income (Rs. 4,80,000/- X 25%) = Rs.
1,20,000/-
 3. Rent Paid Less 10% of Total Income [(Rs. 10,000/- X 12) -
(10% X Rs. 4,80,000)] = Rs.
72,000/-

Lowest of above is Rs. 60,000/- which will be allowed as

deduction under section 80GG.
80GG deduction, Income tax filing, Income tax This page explains about the 80 GG
deduction and the conditions under which it is applicable.

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