Income Tax Notice on Fake HRA Claim: Crores of taxpayers across the country are currently on the radar of the Income Tax Department. Many people claim HRA or house rent exemption worth lakhs of rupees using fake PAN cards. At the same time, some people are claiming HRA by showing that they pay their parents for living.
You need to be careful if you are also employed and follow different ways to save tax every year. The Income Tax Department is currently keeping a close eye on crores of taxpayers across the country and is taking action to send notices to them. But most of the focus is on people who have made wrong claims for HRA claim.
In today’s article, we are going to know what the next reason and what documents should be kept close to such taxpayers if they receive a notice from the Income Tax Department.
Tax savings by making fake documents
Most people do not live on rent, but claim wrong HRA in their office or while filing income tax return to save tax. Many people are availing house rent allowance concession wrongly by using fake PAN card. At the same time there are some people who show that they pay to live in a house named after their parents. So they falsely claim that the house is in their father’s name and they pay monthly in some form or the other, but in reality nothing happens. So now the income tax department has come into action mode.
How much loss will there be in case of tax evasion?
Note that if the Income Tax department catches your theft, you may suffer a huge loss. If you make a false HRA claim while filing your Income Tax Return (ITR), the Income Tax Department will recover the amount from you, but you will also have to pay interest and a 300 percent penalty on it.
Keep the following documents
In such a situation, if you are claiming HRA then you should always maintain some documents and take care of certain things. First of all, keep the rent agreement and monthly receipts. Also if you are paying rent or money to your parents then you should have proof of it too, otherwise you may face problems in future and have to answer income tax notice with proof.
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