I want to explore the HRA exemption option to optimise my tax.
Currently I stay in Pune ( Non Metro city ) in India in a rented flat with my non working senior citizen mother.
Rent a flat at 45K per month which gets me exemption of 3.5L
I was assessing to see if I can get the rent agreement done between my mother and Owner for 45K rent and my mother sublet me the flat for 1Lakh rent. I any way transfer the money to her.
By doing so I can increase my HRA exemption to around 8L.
- Is it allowed to sublet a property at an higher rent?
- Can the rent agreement state that tenant can only sublet to a family member? So that the owner is also not concerned?
- Will there be any extra tax implication for the owner?