The Indian income tax framework has introduced a significant compliance requirement under the revised Rule 205, mandating that salaried employees disclose their relationship with landlords when claiming House Rent Allowance (HRA) deductions. The change aims to tighten verification and curb potential misuse of tax exemptions related to rented accommodation. Previously, employees were only required to submit rent receipts or a rent agreement to support their HRA claim. Now, Rule 205 specifically requires taxpayers to disclose whether the landlord is a relative or a third party, and to provide details accordingly. This update is poised to affect millions of employees who receive HRA as part of their salary structure. What Rule 205 Requires Under the updated regulations, the Income Tax Department now expects the following details from HRA claimants: Whether the landlord is a relative (as defined under income tax law) or not. If the landlord is a relative, the relationship nature — such as father, mother, sibling, etc. If the landlord is not a relative, standard landlord details including name, PAN, and address would still be required. This disclosure must be furnished at the time of filing the income tax return and may also be asked by employers for TDS… Read MoreBusiness Archives – Trak.in – Indian Business of Tech, Mobile & Startups
