INSUBCONTINENT EXCLUSIVE:
AHMEDABAD: With increased use of artificial intelligence for analysis, the income tax department has started asking taxpayers about suspect
deductions claimed for house rent and housing loan interest
According to chartered accountants, many taxpayers show that they are living in a rented property that actually belongs to close relatives
In cases where such taxpayers show they are paying rent, the receiver does not mention this rental income in their returns
Similarly, some taxpayers claim bogus housing loan interest deductions and the I-T department is seeking details about such claims as well
Chartered accountants say some salaried taxpayers use dubious means to save taxes because of the high cost of living and education and fewer
Sources in the income tax (I-T) department said that by using artificial intelligence (AI) for analysis of I-T returns, it is easier to find
The misuse of these heads is under scrutiny
Adding that the claims and actual proof will be assessed through profiles of income taxpayers over the years
deduction based on advice from unqualified persons
One must remember that though I-T returns are self-assessed for individual taxpayers, the department keeps a 360-degree watch
According to the rules, salaried employees get HRA as part of their salary
They need to have a rent agreement, rent payment receipts and must reside in the rented property to claim the deduction
Salaried employees generally claim deduction under Section 80C for life insurance premiums, tuition fees, repayment of housing loans, PPF
and mediclaim premiums under Section 80D
Salaried employees do not have any means to avoid tax liability, so they are tempted to save on tax using dubious practices
Due to the high cost of living, the government should increase basic exemption limit or standard deductions for those with salaries up to Rs
