Income Tax: Due to fake rent slips, people are getting notices, you have this option to get exemption

Income Tax Notice: A notice is being sent by the Income Tax Department to the people who have fraudulently obtained HRA exemption. The Income Tax Department is also taking the help of AI to send notices. You can adopt several methods to get exemption under Income Tax.

Jul 31, 2023 - 13:12
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Income Tax: Due to fake rent slips, people are getting notices, you have this option to get exemption

Some special exemptions are given to employed people in income tax, in which HRA i.e. House Rent Allowance is the main one. A person gets this benefit only when he lives in a rented house while doing a job. Taxpayers have to submit rent slips to claim HRA exemption in ITR.
Many times it is seen that people resort to fake rent slips to claim HRA exemption. In earlier times it was easy to get such an exemption, but in today's time, it has become very difficult. The reason for this is AI, with the help of which any fake claim made in ITR is being easily identified and notices are also being sent to those who do so.
Form 16 is being matched with the help of AI by the Income Tax Department with the Annual Income Figures (AIS) and Form-26AS. Also, it is being matched with the ITR of the landlord. Because if a taxpayer claims an HRA exemption, then his landlord has to show it in his income. In this way, fake cases are being caught by the Income Tax Department.
According to income tax rules, any taxpayer paying rent of more than Rs 1 lakh in a year has to provide the PAN of the landlord while claiming exemption on HRA. With the help of this, the AIS of the landlord is matched by the Income Tax authorities, then the details of this amount are also seen. If a person has claimed fraudulently, then it is known with matching, and a notice is issued by the Income Tax Department.
On the other hand, even if the rent is less than one lakh rupees, fraud is easily detected. Because the rent agreement contains all the information related to the landlord.
If you do a job, then apart from HRA in income tax, you can also take advantage of other exemptions like standard deduction, etc. Apart from this, a tax exemption of Rs 1.5 lakh is available under Section 80C of Income Tax.

Muskan Kumawat Journalist & Writer