House Rent Allowance ( HRA) is an allowance paid by the company to an employee as a rent allowance in addition to their basic salary. This is an important component of the Indian Payroll System. Salaried individuals, who are living in a rented house can claim the HRA to lower their taxes, as it is done to help employees with tax benefits. An employee can claim partially or wholly.
As the name suggests, It is related to rented accommodation, so if you don’t live in a rented house, this allowance is taxable.
Also, See: Conveyance Allowance
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