Sample Rent calculations for a relative

[msankadi]

Hi

One of my relatives reached out to me that he is planning to move to Bangalore and take a rented flat for 52k ...their current rent is 35k...based on that he asked me advice on how his tax will be impacted based on the increased outlay on house rent...

Based on my calculation below based on numbers shared by him (salary >70 80L)....I can see a saving of ~70k in taxes for him annually....so the net add from pocket towards rent would be close to 11k instead of the actual 17k

Are these calculations correct? Would this be actual saving? Any catch or thing that can prevent it being an actual saving for him?
To extend it further, if the rent goes up to 75k would this lead to an additional tax saving of 163k

		12 Months
Basic	324276	3891312
HRA Received	129710	1556520
Old Rent	35000	420000
New Rent	52000	624000
Sample Rent	75000	900000

 

[helloworld]

Rule - Lowest of 3:

with 52k rent

Rent Paid: 624000
HRA Received: 1556520
Rent Paid - 10% Basic: 234869

tax consideration: 234869

Old 35k rent will reduce even further..

ideal rent to get max. deduction = 1.63L per month

then,
HRA Received: 1556520
Rent Paid: 1956000
RentPaid - 10% Basic: 1566869

 

[msankadi]

tax consideration: 234869

Old 35k rent will reduce even further..

Thank you for confirming....I didnt understand the meaning of this line though " Old 35k rent will reduce even further.."
What do you mean by that?

 

[helloworld]

Thank you for confirming....I didnt understand the meaning of this line though " Old 35k rent will reduce even further.."
What do you mean by that?

tax consideration amount reduced with old 35k rent compared to 52k.

Ideally this person can spend 1.63L to get max value.

 

[msankadi]

tax consideration amount reduced with old 35k rent compared to 52k.

Ideally this person can spend 1.63L to get max value.

Thank you for clarifying in detail