New Delhi | Jagran Business Desk: The Ministry of Finance has started to brainstorm on the demand to implement the House Rent Allowance (HRA) of more than 11.56 lakh employees from January 1, 2021. This proposal has been sent to the Railway Board for approval as well.

The demand to implement the HRA from January 1, 2021 has been made by the Indian Railways Technical Supervisors Association (IRTSA) and the National Federation of Railwaymen (NFIR). If it is accepted, then the HRA of lakhs of employees will increase along with getting arrears. They will benefit from about Rs 5400 to Rs 8100 per month.

According to Harishankar Tiwari, former president of AG Office Brotherhood and general secretary of the All India Accounts and Audit Committee, the increase in dearness allowance will increase their House Rent Allowance (HRA) and Transport Allowance (TA). According to the Pay Matrix of the 7th Pay Commission, there will be a different increase in the salary of each level employee. Furthermore, he mentioned that the 7th Pay Commission, in its recommendation, had proposed that when the DA crosses 25 percent, then the HRA will also increase. Its rate will increase from 8, 16, 24 percent to 9, 18, and 27 percent.

In addition, Tiwari mentioned that if someone's basic pay is Rs 30000, then they will get a benefit of about Rs 5400 to Rs 8100 per month. The amount of house rent allowance has been fixed at a minimum of Rs 5400 per month, which cannot be less than this.

House Rent Allowance or HRA is a salary component paid to employees by an employer towards the accommodation cost of living in that city. Employers decide the HRA amount to be paid depending on criteria like the salary structure, salary amount, and city of residence. As a taxpayer, an employee can claim tax benefits on the amount they pay as rent for accommodation each year.

Posted By: Sugandha Jha