Can I pay rent to parents for claiming a deduction ?

Yes you can surely claim a deduction if you are paying rent to your parents. However, the rent paid to the parents will be added to parents’ income and is taxable to them. The taxpayer (in this case you) have to produce the rent receipts to employer for proof of paying rent. You can claim both HRA deduction as well as deduction on interest paid on home loan. The only condition to claim HRA is to show proof that you are paying rent. That is why receipts are needed. You can claim these benefits even if you have rented out the house you have purchased through a home loan, and are yourself living in another rented accommodation. If you are paying rent to your parents and you are getting the receipt for the same, you can claim a deduction. But if you are paying rent to your spouse and you are getting the receipt for the same, you cannot claim a deduction.