HRA Calculator – House Rent Allowance Exemption
Least of: Actual HRA, Rent − 10% of Basic, 50% (metro) or 40% (non-metro) of Basic.
What is HRA?
House Rent Allowance (HRA) is a part of your salary that can be partly tax-exempt if you pay rent. The exemption is available under the old tax regime, so check which regime applies to you before relying on it.
Formula
The exempt HRA is the lowest of: (1) the HRA actually received, (2) rent paid minus 10% of basic salary (plus DA), and (3) 50% of basic for metro cities or 40% for non-metro cities.
Worked example
Monthly basic + DA is ₹40,000, HRA received is ₹20,000, rent paid is ₹18,000, and you live in a metro city. The three values are ₹20,000 (HRA received), ₹14,000 (18,000 − 4,000) and ₹20,000 (50% of basic). The lowest is ₹14,000 per month exempt, so the remaining ₹6,000 is taxable.
Frequently asked questions
Can I claim HRA under the new tax regime?
Generally no. HRA exemption is part of the old regime. Check the current rules for your situation.
Do I need rent receipts?
Keep rent receipts and a rental agreement. Landlord PAN is usually needed if yearly rent is above ₹1,00,000.
Can I claim HRA if I live with my parents?
Yes, if you actually pay rent to them and they report it as income, with proper proof.
Which cities count as metro for HRA?
Delhi, Mumbai, Kolkata and Chennai are the cities treated as metro under the income tax rules.
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Results are estimates for information only and are not financial, tax or legal advice.