Who can claim HRA
You need all four: salaried, HRA as a component in your salary, actually paying rent, and filing under the Old Regime. Self-employed and freelancers don't get section 10(13A) — they fall back to 80GG (much smaller). Under the New Regime, HRA is not deductible at all. If you've defaulted to New, skip the rest.
Documents you actually need
- Rent receipts — monthly or quarterly, signed by landlord, with revenue stamp if rent > ₹5,000/month in cash.
- Rent agreement — employers usually ask, especially for rent above ₹50,000/month.
- Landlord PAN — mandatory if annual rent exceeds ₹1,00,000. No PAN = exemption disallowed. If landlord has no PAN, get a signed declaration in Form 60.
- Bank transfer trail — preferred for high rent. NEFT/UPI to landlord's account stands up to scrutiny; cash doesn't.
Common mistakes
- Claiming HRA and 24(b) home loan interest on the same self-occupied property. Only works if the home is let-out, or you live in a different city for work.
- Skipping landlord PAN for rent above ₹1,00,000/year — the single most common reason HRA gets disallowed.
- Cash-only rent with no receipts or bank trail. First thing scrutiny notices flag, especially for IT/finance salaries.
- Paying rent to parents without a genuine rental contract, bank-traceable transfer, and the parent declaring it as income.
Paying rent to parents — what works
Legal, and the ITAT has upheld it repeatedly — but only when the arrangement is real. The parent must own the property, you must actually transfer rent (NEFT, not cash), there should be a written rent agreement, and the parent must show the rent as income from house property in their own ITR. If the parent is in a lower slab (or below the basic exemption), the family saves tax cleanly.
Updated May 26, 2026. Based on section 10(13A) and Rule 2A under the Income Tax Act, 1961. Always cross-check with your tax advisor for edge cases.