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CS Executive · Tax Laws and Practice · Deductions

Under the Income-tax Act, 2025 (applicable from the June 2027 session), which of the following assessees would be barred from claiming the deduction for rent paid under section 134?

The individual who owns a house at the place where he ordinarily resides or works is barred from the rent deduction, even though he lives in rented premises. Section 134(4) denies relief where the assessee, spouse or minor child owns accommodation at that place.

  1. AAn individual who pays rent for a rented flat and owns no residential accommodation anywhere
  2. BAn individual who owns a house at the place where he ordinarily resides or performs duties of his employment, but lives in a rented flat thereCorrect
  3. CAn individual who pays rent for a furnished flat occupied for his own residence
  4. DAn individual who pays monthly rent for an unfurnished flat in a metro city

Explanation

Section 134(4)(a)(i) denies the deduction where residential accommodation is owned by the assessee, spouse or minor child at the place where he ordinarily resides or performs duties of employment. The first option has no owned house, and furnished or unfurnished accommodation both qualify under section 134(1), so those assessees are not barred.

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