Form 10BA: Benefits and How to Claim Deductions

Form 10BA is a declaration form filed by taxpayers who claim deductions for rent paid under Section 80GG of the Income Tax Act. This form serves as proof that taxpayers meet specific eligibility criteria, ensuring they do not receive any housing-related benefits through other means like employer-provided accommodation or ownership of residential property. By submitting Form 10BA, individuals can claim a tax deduction, making rental housing more affordable and financially manageable. For homeowners, understanding the tax-saving opportunities related to Form 10BA is essential in better planning for the costs associated with purchasing or maintaining property.

Unlock tax benefits with Form 10BA for affordable rental housing solutions. And for those ready to step into homeownership, Bajaj Housing Finance offers tailored home loan options to turn your homeownership dreams into reality.

What is Form 10BA?

Form 10BA is a document prescribed under the Income Tax Act, allowing taxpayers to claim deductions on house rent allowances (HRA) or self-occupied house property. It requires taxpayers to declare their rental income and details of rent paid, facilitating the deduction process for individuals not receiving HRA. This form streamlines the process of claiming tax benefits related to housing expenses, providing a structured method for taxpayers to avail deductions and comply with tax regulations.

Applicability of Form 10BA

Form 10BA is crucial for individuals not receiving HRA but incurring rent expenses, providing relief under Section 80GG of the Income Tax Act, 1961. For instance, Ravi, a freelancer, pays rent for his Mumbai apartment and can claim deductions using Form 10BA. The form helps reduce taxable income, benefiting those with significant rent payments. To file, individuals log in to the Income Tax e-Filing Portal, fill in details about the rented property and rent paid, and complete the declaration section. This form simplifies tax compliance for individuals facing rent-related tax deductions without HRA benefits.

When should one file Form 10BA?

To claim a deduction under Section 80GG for rent paid, it's essential to file Form 10BA before submitting your Income Tax Return (ITR). This form helps reduce taxable income and tax liability, especially if a substantial portion of income goes towards rent payments. For the financial year 2023–24, Form 10BA must be filed by July 31, 2024. If book audits are necessary, the filing deadline extends to September 30, 2024. Timely submission ensures eligibility for rent-related deductions and compliance with tax regulations.

How to file Form 10BA online?

Here's how to file Form 10BA:

1. Log in to the Income Tax e-Filing Portal.
2. Navigate to 'e-File' > 'Income Tax Forms' > 'File Income Tax Forms'.
3. Search for or select Form 10BA.
4. Click on 'File now' to proceed.
5. Choose the appropriate assessment year for filing the return.
   

Benefits of Form 10BA

Form 10BA is pivotal for claiming deductions under Section 80GG of the Income Tax Act, 1961. Here's why it's beneficial:

1. Rent deduction: If you don't receive HRA but pay rent, Form 10BA allows you to claim a deduction for the rent paid. This applies even if you don't own property in the same city.
2. Tax reduction: Filing Form 10BA helps lower your tax liability. It's particularly helpful for those with no HRA and individuals with low incomes.
3. Self-employed advantage: Self-employed individuals can optimise their tax situation by using Form 10BA.
   

Documents required for filling out Form 10BA online

When filing Form 10BA online, ensure you have the following documents ready:

1. Rent receipts and rental agreement: Keep copies of rent receipts as proof of payment and have a valid rental agreement with your landlord.
2. Permanent Account Number (PAN): Your PAN details are required for filing Form 10BA.
3. Declaration of non-ownership: Declare that you do not own any residential property in the city where you're claiming the deduction. This ensures you're eligible for the rent deduction under Section 80GG.
   

Amount eligible for claiming deduction under Section 80GG

Under Section 80GG, individuals can claim a deduction for rent paid if they don't receive House Rent Allowance (HRA) from their employer. The deduction is the least of Rs. 5,000 per month or Rs. 60,000 per year, 25% of adjusted total income, or actual rent paid minus 10% of adjusted total income. This deduction is available under the old tax regime, and Form 10BA must be filed with details of the rent payment. If the annual rent exceeds Rs. 1 lakh, the property owner's PAN card is required.

Things to remember about Form 10BA

Here are some important points to remember about Form 10BA:

1. Form 10BA is for individuals paying rent for residential accommodation, aiming to claim deductions under Section 80GG.
2. You must meet specific criteria, including opting for the old tax regime and not receiving HRA from your employer.
3. The HRA component should not be part of your salary, and owning a self-occupied residential property disqualifies you.
4. Form 10BA submission is mandatory, with PAN card submission for rents exceeding Rs. 1 lakh annually.
5. Deduction is the least of Rs. 5,000 per month, 25% of adjusted total income, or actual rent paid minus 10% of adjusted total income.

Now that you understand all about Form 10BA and its benefits for claiming deductions on rent paid, it's time to take the next step towards your homeownership journey. Explore the advantages of a Bajaj Housing Finance Home Loan, tailored to suit your needs and make owning your dream home a reality.

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Form 10BA plays a vital role for taxpayers who seek deductions on rent paid under Section 80GG of the Income Tax Act. It ensures that individuals who don't receive HRA can claim significant tax benefits, making rental housing more affordable. Understanding the requirements and timely submission of this form helps optimise your tax savings while maintaining compliance. For those aiming to transition from renting to homeownership, a Bajaj Housing Finance Home Loan provides flexible, competitive financial support, ensuring that buying a home becomes an attainable reality. Apply for a home loan today.