Why you need rent receipts
If you claim HRA exemption under the old tax regime, your employer usually asks for proof of rent paid before reflecting the exemption in your TDS. Rent receipts — together with a rent agreement and bank statements — are that proof. Without them, your employer may deduct tax on the full HRA, and you would have to claim the refund when filing your return.
Rent receipts are not needed under the new regime, which does not allow HRA exemption. To see how much of your HRA they could make tax-free, use the HRA calculator.
What a valid rent receipt contains
- Tenant's name and landlord's name
- Address of the rented property
- Rent amount and the month it covers
- Mode of payment (bank transfer, UPI, cheque or cash)
- Landlord's signature
- Landlord's PAN, if annual rent exceeds ₹1 lakh
The generator fills in all of these; print the receipts and have your landlord sign each one.
Rules worth knowing
- PAN above ₹1 lakh a year. If your total rent for the year exceeds ₹1 lakh (₹8,333 a month), your employer needs your landlord's PAN. If the landlord has no PAN, a declaration from them is required.
- Revenue stamp for cash. For cash payments above ₹5,000, a ₹1 revenue stamp signed by the landlord is customary on the receipt. Paying by bank transfer or UPI avoids this and creates a stronger record.
- Paying rent to parents is allowed if the payment is genuine (preferably by bank transfer), the parents own the home and they declare the rent as their income.
- Keep records for years. The tax department can ask for evidence of rent paid during scrutiny, so keep receipts, the agreement and bank statements together.
Monthly or quarterly receipts?
Either works; many employers accept one receipt per month or per quarter. Monthly receipts match bank transfer records more easily, which is why the generator creates one per month.