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HRA Exemption Calculator

Calculate HRA tax exemption under Section 10(13A). 50% for metro, 40% for non-metro. Old tax regime only.

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How to use this calculator
  1. 1

    Enter salary details

    Enter your monthly Basic Pay and Dearness Allowance (DA), and the HRA received from your employer.

  2. 2

    Enter rent and city type

    Enter your monthly rent paid and select whether you live in a metro city (50% rule) or non-metro (40% rule).

  3. 3

    View exemption breakdown

    The calculator applies the least-of-three rule and shows exempt HRA, taxable HRA, and approximate annual tax savings.

HRA Exemption Result

(A) Actual HRA received: ₹2,40,000

(B) 40% of salary (non-metro): ₹1,92,000

(C) Rent − 10% of salary: ₹1,80,000 − ₹48,000 = ₹1,32,000

HRA Exempt (tax-free)

₹1,32,000

Minimum of (A), (B), (C)

HRA Taxable

₹1,08,000

Approximate annual tax savings

20% bracket

₹27,456/yr

30% bracket

₹41,184/yr

Generate rent receipts for HRA claim

Free rent receipt PDF: landlord/tenant details, rent period, amount. No signup.

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Quick answer

HRA exemption is the least of: actual HRA, 40%/50% of salary, and rent paid minus 10% salary. New regime generally does not allow HRA exemption.

House Rent Allowance (HRA) is a component of salary that employers pay to employees to cover rental expenses. Under Section 10(13A) of the Income Tax Act, a portion of HRA can be claimed as tax-exempt, but only under the old tax regime.

What is this calculator?

An HRA Calculator estimates how much of your HRA is tax-exempt and how much is taxable. Enter your basic salary, DA, HRA received, and rent paid. The calculator applies the 'least of three' rule and shows your exemption, taxable HRA, and approximate tax savings.

Formula

HRA exemption = Least of these three:

(A) Actual HRA received from employer.
(B) 50% of salary (Basic + DA) if you live in a metro city (Delhi, Mumbai, Chennai, Kolkata), or 40% for non-metro.
(C) Rent paid − 10% of salary (Basic + DA).

'Salary' = Basic Pay + Dearness Allowance (only if DA forms part of retirement benefits). This is as per Rule 2A of the Income Tax Rules.

Example

Raghu lives in Mumbai. Basic salary: ₹50,000/month. HRA received: ₹1,00,000/year. Rent paid: ₹15,000/month. (A) Actual HRA = ₹1,00,000. (B) 50% of salary (metro) = 50% × 6,00,000 = ₹3,00,000. (C) Rent − 10% salary = ₹1,80,000 − ₹60,000 = ₹1,20,000. Least = ₹1,00,000. Raghu's entire HRA is tax-free. If he was in a non-metro city, (B) would be 40% × 6,00,000 = ₹2,40,000. Still ₹1,00,000 is least, so same exemption.

Scenario snapshots

Metro vs non-metro rent case

Compare exemption impact at 50% vs 40% salary cap while keeping rent constant.

Old vs new regime decision

Estimate HRA benefit and then compare full tax outcome using income-tax calculator.

Decision guide

Choose this when

  • ✓You are salaried, living on rent, and evaluating exemption under old regime.
  • ✓You want to estimate taxable HRA before payroll proof submission.
  • ✓You are comparing city/rent structure changes and tax impact.

Pick another route when

  • •You have opted for new regime where HRA exemption is generally unavailable.
  • •You need payroll-grade monthly proration with frequent rent/salary changes.
  • •You are filing complex mixed-year tenancy documentation disputes.

Common mistakes to avoid

  • !Using gross salary instead of Basic + eligible DA in the formula.
  • !Ignoring landlord PAN requirement when annual rent crosses threshold.
  • !Assuming full HRA received is always tax-exempt.

Assumptions and disclaimers

Updated context: FY 2026

  • •Least-of-three method under standard rules is used for estimate.
  • •Metro classification follows major city categorization in common tax practice.
  • •Document compliance and payroll processing can affect final exemption.

In practice (India)

HRA calculator searches usually include metro vs non-metro limits, PAN requirements for rent above threshold, and old vs new regime confusion. This tool applies the standard least-of-three logic and is useful for salary planning before submitting proofs to payroll.

You can compare final tax outcomes by pairing this with our income tax calculator, especially if you are deciding whether to opt into the new regime. Keep rent agreement, receipts, and payment evidence for compliance.

Benefits

  • ✓Know exactly how much of your HRA is tax-free before filing ITR.
  • ✓Compare metro vs non-metro exemption to understand the impact of city classification.
  • ✓See approximate tax savings at 20% and 30% brackets instantly.
  • ✓Plan rent payments and salary restructuring for maximum HRA benefit.

Related calculators and guides

Frequently Asked Questions

Can I claim HRA by paying rent to my parents?
Yes. If your parents own the house and declare the rent as 'income from house property' in their ITR, you can pay them rent and claim HRA exemption. Maintain a rental agreement and pay via bank transfer.
Is HRA available under the new tax regime?
No. HRA exemption under Section 10(13A) is available only under the old tax regime. If you opt for the new regime (Section 115BAC), HRA becomes fully taxable.
What if my annual rent exceeds ₹1 lakh but landlord won't give PAN?
Landlord PAN is mandatory if annual rent exceeds ₹1,00,000. Without it, the employer or tax department may disallow the HRA claim entirely. Get the PAN at the start of tenancy.
Can I claim both HRA and home loan deductions?
Yes. If you own a house (with home loan) in one city and live in a rented property in another city for work, you can claim both HRA exemption and home loan interest deduction under Section 24(b).
I forgot to submit rent receipts to HR. Can I still claim?
Yes. Claim HRA exemption when filing your ITR. If excess TDS was deducted, you'll get a refund. Keep rent receipts and bank transfer proof as evidence.

HRA exemption is available only under the old tax regime. For the new regime, HRA is fully taxable. Consult a tax advisor for personalised advice.