Can I get a tax deduction for rent expense on apartment/flat?

I am currently based in USA and am thinking of accepting a job offer in Mumbai.

Assuming that I rent a flat/apartment in Mumbai for INR 50,000/month or INR 6,00,000 a year, could I claim this rent expense to reduce my taxable income.

I also heard that you may or may not be able to do this based in whether your company provides HRA- what is that clause?

I am new to this process- any help would be highly appreciated.

Thanks

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5 Responses to “Can I get a tax deduction for rent expense on apartment/flat?”

Prasanth Says:
July 23rd, 2009 at 6:13 am
Yes, HRA component is a must for tax exemption under section 10(13A).
The tax exemption for HRA is the minimum of the following:
1. (Basic+DA)*0.5 ; if DA is not a component, take DA=0.
2. Actual rent paid - [(basic+DA)*0.1]
3. HRA component.

As you can see if HRA is 0, your tax benefit is also 0.

If you are a salaryied employee, you can download the tax calculator from
Jss Says:
July 24th, 2009 at 8:21 pm
Ask employer to pay you HRA, which will reduce your basic income. For HRA deduction and other deductible allowances, read Income From Salary
Ram D Says:
July 25th, 2009 at 2:22 am
There is no tax deduction fdor rent expense on apartment/flat.
delta Says:
July 25th, 2009 at 2:32 pm
only if you get an allowence called House Rent allowence from your employer/.
Amit M Says:
July 26th, 2009 at 9:31 pm
You can claim the deduction of Rent paid from your income. You may not get full deduction, because this deduction is subject to calculation method as per income tax law.

First, Ask your employer to include House Rent Allowance in your salary package, that can be equal to your rent paid.

Though this will require some more tax planning in determining your salary package. If your employer gives you the liberty to dertimine your salary package, you need to consult professionally.