HRA Exemption Calculator
Calculate your HRA (House Rent Allowance) exemption amount for Income Tax planning.
Salary & Rent Details (Annual)
Exemption Calculation
Exempt HRA Amount
₹0
This amount is deducted from taxable income.
Maximize HRA Savings
House Rent Allowance is a powerful tool to reduce tax liability in the Old Tax Regime.
The Calculation Rule
The exemption is the lowest of:
- Actual HRA Received from employer.
- 50% of Salary (if living in Delhi, Mumbai, Kolkata, Chennai) OR 40% of Salary (other cities).
- Rent Paid - 10% of Salary.
(Salary = Basic Pay + Dearness Allowance)
Tips:
- Always keep rent receipts.
- Make payments via bank transfer for proof.
- If paying parents, ensure they file ITR to avoid scrutiny.
Frequently Asked Questions
What is HRA Exemption?
House Rent Allowance (HRA) is a salary component paid by employers for rent expenses. The Income Tax Act allowing a partial or full exemption on this allowance under Section 10(13A).
How is HRA Exemption calculated?
It is the minimum of three values: 1) Actual HRA received, 2) 50% of Salary (Metro) or 40% (Non-Metro), 3) Rent paid minus 10% of Salary. 'Salary' here means Basic + DA.
Is HRA exemption part of New Tax Regime?
No. The New Tax Regime (default from FY 23-24) does NOT allow HRA exemption. You must stick to the Old Tax Regime to claim it.
What are Metro cities for HRA?
Only four cities are considered Metros for HRA rules (50% rule): Delhi, Mumbai, Kolkata, and Chennai. All other cities (like Bangalore, Hyderabad, Pune) fall under the 40% rule.
Can I claim HRA if I live in my own house?
No. You cannot claim HRA exemption if you live in a house you own. You must actually pay rent to claim this benefit.
Can I claim HRA if I pay rent to my parents?
Yes, you can. You need to consistently transfer rent to their bank account, and they should declare it as 'Income from House Property' in their ITR. A formal rent agreement is recommended.
Can I claim HRA if I pay rent to my spouse?
This is risky and often rejected by tax authorities, because the relationship is not considered commercial. It is best to avoid claiming HRA for rent paid to a spouse.
Is landlord's PAN mandatory?
Yes, if your total annual rent payment exceeds ₹1,00,000 (approx ₹8,333/month), quoting the Landlord's PAN is mandatory to claim exemption.
What if my employer doesn't give HRA?
If you don't receive HRA but pay rent, you can claim a deduction under Section 80GG, up to ₹60,000 per year, subject to certain conditions.
Can I claim both HRA and Home Loan Interest deduction?
Yes! If you own a house in one city (and pay loan EMI) but live in a rented house in another city for employment, you can claim both HRA exemption and Section 24(b) interest deduction.