Can a landlord sublease his home to his wife who does not have any income, and thereby save on tax. Effectively, he will collect a smaller amount as rent and then his spouse sub leases to tenants at a premium and records as income from business while the landlord pays tax on the nominal rent from his spouse. This is to ensure a sustainable remuneration.
a. Can the tenants claim HRA for paying rent to spouse?
b. Can the landlord collect rent from his wife as arrears in the subsequent year as per agreement.
c. Is there any potential issue if all of it is declared and filed?
d. Are there any changes to the treatment if the landlord leases to his spouse with sub lease for more than 12 years?