HRA exemption on rent paid to relative may be prone to scrutiny
HRA exemption is not available if the house occupied by you is owned by you or you have not actually incurred expenditure on payment of rent towards the house
It should be noted that rental payments to relatives may be prone to scrutiny and the genuineness of the HRA exemption can be questioned
I reside in a house owned by my mother and I pay her rent and have been claiming house rent allowance (HRA) for the same for the last seven years. We are now planning to sell this house and buy a new one which will be financed by the proceeds from the sale of the old house and my mother’s other savings, including the rent I pay her. We wish to get my name included as a joint owner in the newly purchased property but I will not be contributing anything financially towards this new property. Can I still continue paying rent to my mother after we move into the new house though I will be a joint owner? Can I still continue claiming HRA exemption on such payment?