In the first two months of the calendar year, the salaried class has to submit the final proofs in the first two months of the calendar year, for correct calculation of TDS.
One major change as compared to last year is the need of Landlords PAN, in case the monthly rent is above Rs.8,333. Yes, if the landlord doesn’t have a PAN, declaration has to be filed by the employee and not by the landlord.
If you plan to claim tax exemption under house rent allowance (HRA) for the current financial year, remember that you will have to furnish the Permanent Account Number (PAN) of your landlord if your annual rent exceeds Rs.1 lakh, or Rs.8,333 per month. Earlier you had to furnish PAN of your landlord only if annual rent exceeded Rs.1.80 lakh, or Rs.15,000 per month.
It is now mandatory for employees to submit PAN of the landlord to the employer if the annual rent exceeds Rs. 1,00,000 per annum and such an employee is claiming House rent exemption (HRA) under section 10 (13A) of Income Tax Act.
Salaried taxpayers, who want to claim I-T exemption on house rent allowance exceeding Rs. 1 lakh per annum, will have to obtain the PAN card number and other details of their landlord on a plain A-4 size paper before submitting it to their employer.
One good point of the circular is that it states that only the PAN number has to be submitted and not the Xerox copy of the PAN Card or a sworn affidavit or a notarized document.
This means that the Income Tax department has a number of technical platforms to check the authenticity of this information that is provided to it by a salaried taxpayer. The circular has not stated explicitly about the kind of document so it is considered that a plain piece of paper would do.
The Income Tax department will require this document to enable exemption for a taxpayer under House Rent Allowance (HRA) after the Central Board of Direct Taxes (CBDT) issued a circular in this regard in October last year.