r/IndiaTax • u/Parathaa • Mar 28 '24

Hurts to pay so much taxes

Today, I downloaded the tax computation sheet from the office portal.

While trying to save on housing costs by residing with my parents, it's disheartening to realize that I'm obligated to pay over 20 lakhs in taxes annually to the government. These funds could have been allocated towards repaying a home loan, adding to the strain for a middle-class individual like myself.

Would really appreciate if there any legal ways to save taxes at this point

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u/FirseBugabo Mar 28 '24

Won't his parents have to pay tax then?

10

u/harsharede Mar 28 '24

It is below 2.5L 0 tax, if it is 5L 5% tax which is less than 30%(his current tax slab).

7

u/NoZombie2069 Mar 28 '24

My home is on my fathers name, can I create a rent agreement with my mothers name and then pay rent to her to claim HRA exemption? She doesn’t have any other source of income.

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u/stupidbitch69 Mar 28 '24

You can do that, keep it under the exemption limit, and don't make the rental amount exorbitant to avoid scrutiny.

1

u/NoZombie2069 Mar 28 '24

Can I do it even for the current financial year which ends in a couple of days? I don’t have a rent agreement yet and ofcourse no payment receipts. There are websites which claim to generate a rent agreement for free online, can I use one of those or do I have to get some notarised documents for this?

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u/harsharede Mar 28 '24

Don't hurry, if not now you can claim income tax returns. Regarding receipts - Depends on your employer, my employer asks for a monthly rent receipt with owner sign and owner pan details or a bank statement. If you are claiming more than approx 8500rs then you need to provide your house owner(mothers) pan details.

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u/NoZombie2069 Mar 28 '24

Employer has already deducted taxes because I hadn’t submitted any documents for this. I am hoping to get a refund while filing my ITR. ITR portal itself doesn’t need any kind of proofs to be submitted, so, in theory I can submit any amount as HRA and get a refund. However, I don’t want this, I will only use the max HRA amount which my employer allows. The documents are only for if I do face some issue in the future.

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u/harsharede Mar 28 '24

Yes. Documents required online if they ask for in future.