HRA Calculator — India (₹)

Calculate your tax-free House Rent Allowance exemption under Section 10(13A) for metro and non-metro cities. See the three-way minimum rule applied to your exact figures.

🏠 Salary & Rent Details
Metro: Delhi, Mumbai, Kolkata, Chennai
HRA Exemption (Tax-Free)₹1,20,000
Taxable HRA₹1,20,000
Monthly Exemption₹10,000
Monthly Taxable HRA₹10,000
🔢 Three-Way Minimum Rule
(a) Actual HRA Received₹2,40,000
(b) 50% of Basic+DA₹3,00,000
(c) Rent Paid − 10% of Basic+DA₹1,20,000
✅ HRA Exemption = Min(a, b, c)₹1,20,000
📋 Annual rent > ₹1L: Landlord PAN required for HRA exemption claim in ITR

What is HRA (House Rent Allowance)?

HRA (House Rent Allowance) is a salary component provided by employers to help employees cover rental costs. Under Section 10(13A) of the Income Tax Act, a portion of HRA is exempt from income tax, provided the employee is actually paying rent and living in a rented accommodation. HRA exemption applies only under the Old Tax Regime — not available under the New Tax Regime.

The exempt HRA is calculated using a three-way minimum rule: the lowest of (a) actual HRA received, (b) 50% of Basic+DA for metro cities / 40% for non-metro cities, or (c) actual rent paid minus 10% of Basic+DA. This means paying higher rent and having a higher HRA component in salary both contribute to a larger exemption.

How to Use This HRA Calculator

  • Basic + DA: Enter your Basic Salary + Dearness Allowance (not gross salary). HRA calculation is based on this, not your full CTC.
  • Actual HRA Received: Enter the HRA component of your salary — shown separately in your salary slip or Form 16.
  • Rent Paid: Enter actual rent paid to your landlord. This must be supported by rent receipts.
  • City Type: Select Metro (Delhi, Mumbai, Kolkata, Chennai) for 50% rule, or Non-Metro for 40% rule. Other cities like Bangalore, Hyderabad, Pune are Non-Metro for this purpose.

Key Factors That Affect HRA Exemption in India

  • Basic Salary Level: HRA exemption depends on Basic+DA, not gross salary. A lower basic as a percentage of CTC means lower HRA exemption — common in restructured salary packages designed to minimise HRA claims.
  • Rent Amount: Only rent exceeding 10% of Basic+DA qualifies. If your monthly basic is ₹50,000 (annual ₹6L), you need to pay more than ₹5,000/month (₹60,000/year) rent before any exemption kicks in from this component.
  • Metro vs Non-Metro: Metro city residents get 50% of Basic+DA as the cap, while non-metro is 40%. This difference of 10% of Basic+DA can be ₹60,000–₹1L difference in exemption for senior employees.
  • HRA as % of Salary: If HRA received is very small relative to rent paid and Basic, it becomes the binding constraint. Negotiate with your employer to restructure salary to have a higher HRA component if you pay significant rent.

Tips to Maximise HRA Tax Exemption in India

  • Keep all rent receipts: Issue rent receipts monthly. Each receipt should include landlord name, address, period, amount paid, and landlord signature. Revenue stamp is required for amounts above ₹5,000/month (though in practice a signature suffices).
  • Get landlord PAN for rent above ₹1 lakh/year: If annual rent paid exceeds ₹1 lakh (₹8,333+/month), you must submit landlord's PAN to your employer. Without PAN, the employer cannot process the HRA exemption claim.
  • Negotiate salary structure for higher HRA: If you pay significant rent, request your employer to restructure CTC to have a higher HRA component (ideally 40–50% of Basic). This directly increases your tax-free income.
  • Don't miss HRA if paying rent to parents: Paying rent to parents who own the property is a valid HRA claim. Ensure they declare it as income and do it via bank transfer. This is especially beneficial if parents are retired with lower income tax liability.

Disclaimer: HRA exemption is applicable only under the Old Tax Regime. The calculator follows Section 10(13A) of the Income Tax Act. Metro cities are Delhi, Mumbai, Kolkata, and Chennai only. Consult your CA for individual tax advice.