The Income Tax Department has introduced a significant change to ITR forms for Assessment Year 2026-27, requiring taxpayers to provide both primary and secondary addresses instead of just one address. According to reports from Moneycontrol, this change affects all taxpayers and is not specifically linked to HRA claims, but rather aims to maintain updated contact information and reduce communication issues from outdated address records.
The secondary address requirement particularly benefits salaried employees claiming HRA under the old tax regime who reside in rented accommodation different from their permanent home. As reported by Moneycontrol, tax experts suggest this change enables the Income Tax Department to better identify where taxpayers actually stayed for rent purposes and reduce ambiguity in HRA reporting. The rented accommodation can be reported as the primary address, while the permanent residence can be disclosed as the secondary address. For FY 2025-26, HRA exemption calculations follow specific rules where only a calculated portion is tax-free, with the exemption being the smallest of three limits: actual HRA received, 50% of Basic+DA (metro) or 40% (non-metro), or actual rent paid minus 10% of Basic+DA.
While incorrect, incomplete, or inconsistent secondary addresses do not automatically lead to HRA claim rejection, they may trigger additional scrutiny during processing. According to CleaTax tax expert Chandni Anandan, if the secondary address does not match supporting records, the tax department may seek additional clarification including rent receipts, lease agreements, landlord details, and address proof to verify the claim. A mismatch may also cause delays in processing or disallowance of the HRA claim if supporting documents don't align with the return address. For HRA claims, specific documentation requirements include rent receipts (unless monthly rent is ₹3,000 or less), rent agreements, bank transfer proof (preferred over cash), and landlord's PAN if annual rent exceeds ₹1 lakh.
HRA eligibility continues to depend on rent paid, salary structure, and supporting documents such as rent receipts and lease agreements, regardless of address disclosure. As noted by Deloitte India Partner Mousami Nagarsenkar, the requirement is not specifically linked to HRA claims but aims to provide the tax department with more complete address records. Taxpayers claiming HRA should ensure all information provided in returns is accurate and consistent with supporting documentation to avoid processing delays or scrutiny issues. The new regime rules for FY 2026-27 expand the metro cities eligible for 50% HRA exemption to include Bengaluru, Hyderabad, Pune, and Ahmedabad, while non-metro cities continue to receive 40% exemption. The old regime remains worthwhile only if HRA exemption plus other deductions (80C, 80D, home loan interest) outweigh the new regime's lower slab rates and ₹75,000 standard deduction.
