In a relief to people
living in rented accommodation, Finance Minister Arun Jaitley on
Monday announced in his budget speech that deduction under section 80GG on
house rent allowance(HRA) will be increased from Rs 24,000 to Rs 60,000.
“The
people who do not have any house of their own and also do not get any house
rent allowance from any employer today get a deduction of Rs 24,000 per annum
from their income to compensate them for the rent they pay. I propose to
increase the limit of deduction in respect of rent paid under section 80GG from
Rs 24,000 per annum to Rs 60,000 per annum, which should provide relief to
those who live in rented houses, ” Finance Minister Arun Jaitley said in his budget
speech.
According
to budget provision, the existing provisions of Section 80GG provide for
a deduction of any expenditure incurred by an individual in excess of ten per
cent of his total income towards payment of rent in respect of any furnished or
unfurnished accommodation occupied by him for the purposes of his own residence
if he is not granted house rent allowance by his employer, to the extent such
excess expenditure does not exceed Rs 2,000 per month or 25 per cent of
his total income for the year, whichever is less. These amendments are proposed
to be made effective from the 1st day of April, 2017 and shall accordingly
apply in relation to assessment year 2017-18 and subsequent years.
