The Income Tax Department on Monday said it has found a difference between the rent paid to salaried employees (salaried class) for the financial year 2020-21 and the amount received by the recipient. The department has analyzed the data in high value cases. The Central Board of Direct Taxes (CBDT) has refuted reports that the department is running a special drive to reopen House Rent Allowance (HRA) cases. The rent paid by the tenant and the rent received by the recipient were verified. The number of such cases is very less.
Verification was done in very few cases
According to the report, the CBDT said in the statement that the data was analyzed in some high value cases involving discrepancies between the fare paid by the employee and the amount received by the recipient for the financial year 2020-21. This verification was done in a very small number of cases and a large number of cases have not been reopened. It said that the purpose of e-verification was to alert about cases related to discrepancies in information only for the financial year 2020-21 without influencing others.
The department has alerted taxpayers
CBDT said that some cases of discrepancy between the returns filed by taxpayers and the information available with the Income Tax Department have come to the notice of the department. This is nothing but a part of the routine steps taken to verify the data. In such cases, the department has alerted taxpayers so that they can take corrective steps.
House rent allowance is part of salary income or CTC. It is calculated in taxable income. However, if an employee lives in a rented accommodation, he can claim income tax exemption for HRA earned during the year by submitting a valid rent receipt. However, if taxpayers opt for the new tax regime, they do not get any exemption.
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