Mr. Ram annually earns ₹ 3,00,000 (after all deductions) and pays an annual rent of ₹ 1,50,000.

Chapter No. 15 - Deduction u/s 80GG

. In such a case, the deduction allowed would be least of the following:-

1.Rs. 2000 per month i.e. Rs. 24000 per annum

2.Rent paid i.e. 1,50,000 minus 10% of total income i.e. 30,000 =  1,20,000

3.25% of total income i.e. Rs. 75,000

The least of the above would be allowed as a deduction and therefore ₹ 24,000 would be allowed as a deduction under Section 80GG.

Dated: 13-8-2015