According to new Income Tax Act, 2025 and new rules effect on April 1, 2026, it affects how salaried employees claim House Rent Allowance (HRA) deductions. The new update come is to disclose the relationship with landlord when applying for HRA benefits, especially of you are paying rent to family member.
HRA Claim Rules Change from April 1, 2026
The government’s draft tax rules aim to reduce misuse of HRA claims. This includes cases where employees report rent paid to family members without true financial substance. By requiring disclosure of the tenant-landlord relationship, authorities want to ensure that HRA exemptions claimed for legitimate rent payments and to minimize tax avoidance.
What You Must Now Disclose
Under the proposed rules that expected to start on April 1, 2026, employees claiming HRA provide the following details to their employer for verification and TDS calculation
Mandatory Details to Furnish
- Landlord Details: Name, address, and PAN, especially if annual rent exceeds ₹1 lakh.
- Relationship with Landlord: Indicate whether the landlord is related (such as a parent, spouse, sibling, etc.) or unrelated.
- Rent Paid Proof: Rent receipts and bank payment evidence still required.
This information typically submitted using a standard form (like Form 124) or as part of your annual declaration to HR for tax deduction at source (TDS) purposes.
Read also: Mumbai Digital Arrest Scam: North Cyber Police Nab Key Accused Asad Shaikh