Claiming Both HRA and Home Loan Interest in ITR? Know the Rules:

Taxpayers can claim tax exemption on both HRA and Home Loan Interest if they meet certain conditions.

How to Claim Tax Benefit on Both HRA and Home Loan Interest

Nidhi

Jun 27, 2025

Last update on Jun 27, 2025

Claiming Both HRA and Home Loan Interest in ITR? Know the Rules

A lot of people wonder if they can get tax benefits for both paying rent and having a home loan. Salaried individuals receive House Rent Allowance (HRA) along with their salary to cover the cost of living in rented housing. Many people take a home loan to buy a house, which might be under construction or rented out, but still live in a rented house for work or other reasons. So, is it possible to claim exemption on both the HRA and home loan interest? The good news is, yes, you can claim both, and it is completely legal . However, to do this, you must meet certain conditions. Let us understand the conditions under which you can claim both.

Conditions to Claim both HRA and Loan Interest

You Work in a Different City: If you bought a house in one city (like Noida), but your job is in another city (like Mumbai), and you live there on rent, then you can claim both HRA and home loan benefits.

You Live on Rent in Same City: Sometimes, your own house is far from your office or not convenient to live in due to traffic or travel time. So, you choose to stay in a rented place nearby. If you have a genuine reason and can explain it, you can claim both benefits.

You Rented Your House: If you have given your house on rent to someone else for investment purposes, but you are living in a rented place yourself, then you can also claim both HRA and home loan deductions.

Required Documents For HRA Claim

To claim the HRA exemptions, you need the following documents:

Rent receipts
Rent agreement
Landlord's PAN (if rent is more than Rs 1 lakh in a year)

Required Documents For Home Loan Claim

To claim the exemptions on home loan interest, you need the following documents:

Home loan statement (Including interest and principal paid details)
Sale deed (proof you bought the house)
Possession letter or completion certificate

Which Sections to Use for these Exemptions

Type of Benefit	Section	Maximum Limit
House Rent Allowance	Section 10(13A)	Based on your salary and rent paid
Home loan interest (self-occupied)	Section 24(b)	Up to Rs 2 lakh per year
Home loan principal	Section 80C	Up to Rs 1.5 lakh per year

Important Things to Keep in Mind

Before claiming the tax benefit on home loan and HRA make remember the following things:

If you are residing in the same city and claim both HRA and home loan, the income tax department might start keeping an eye on you.

The Income Tax Department requires you to submit detailed proof for claiming deductions, so make sure you have all the necessary documents.

The tax benefit on HRA and Home loan interest (for self-occupied property) is available only in the old tax regime, but not in the new tax regime. Therefore, choose the old tax regime if you want to claim exemption on both HRA and home loan.

The tax exemption on Home loan interest (Let-Out property) is available in both the tax regimes; however, the exemption on principal repayment of home loan (under section 80C) is only available under the old tax regime.

The new ITR form includes many details, which you must fill such as the landlord's name, PAN, and the rent period. Therefore, do not even think of claiming deductions, as you will get into legal issues.

If the landlord is your parent but you still pay them rent, then you must submit the proof of payment (bank transaction) along with your parent's PAN number.

About Author

Nidhi

Content Writer

Nidhi is a skilled content writer specializing in personal finance. She creates clear, engaging articles on mutual funds, investments, insurance, and wealth-building strategies. With a passion for simplifying complex financial topics, Nidhi helps readers make informed money decisions with confidence. She can be reached at [email protected]