For folks who work and rent a place to live, there's a helpful way to save on taxes called House Rent Allowance (HRA) deduction. This HRA thing is like a part of your salary given by the employer to help with paying the rent for your home. Knowing how this works can really help you save some money when it's tax time.
Your deduction will be restricted to least of the following :-
1) 5000 per month or Rs.60,000 for whole year.
2) 25% of total income (excl LTCG, STCG, & Deductions).
3) Actual Rent less 10% of income.
Conclusion:
Knowing about HRA deduction can help you save money when you file your taxes. It's important to follow the rules and keep all the needed papers. If you're not sure, it's a good idea to ask someone who knows about taxes, like a tax consultant or financial advisor. Using HRA deductions is a smart way to manage your money better and pay fewer taxes.