If a difference is found between the two, a notice is sent to you from the I-T Department. Let us tell you that all transactions related to PAN are written in AIS form. With this, the Income Tax Department matches the amount claimed under your HRA with the amount sent to your landlord's PAN number. If the employee pays more than Rs 1 lakh as rent, they will also have to provide the PAN number of their landlord.
There is a rule related to House Rent Allowance that one can claim deduction of HRA only if they are getting HRA from the company. When a taxpayer claims House Rent Allowance through rent receipt, the Income Tax Department matches their claim with these forms and if they find any difference, they become alert. Let us tell you that all the transactions related to PAN card are recorded in these forms. In the era of Artificial Intelligence (AI), the Income Tax Department is also using AI to detect fake rent receipts.įor this, AIS Form and Form-26AS are matched with Form-16. Now the question arises that how is this happening? How the I-T department knows that a particular rent receipt is fake or genuine. The Income Tax Department has started sending notices (IT Notices) to those who claim tax deduction by submitting fake rent receipts since last year.
The Income Tax Department is also noticing it and has now started cracking down on such illegal practices. For the last many years, many people have been saving taxes in this way.
