HRA Calculator
Calculate exempt and taxable HRA under Section 10(13A) — old regime tax saving on house rent.
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Adjust the inputs on the left to see your hra exempt.
Plenty of salaried folks see HRA on their payslip and assume the whole thing is tax-free. It isn't. The exemption is capped by a rule that compares three different amounts and hands you only the smallest one. Misjudge it and you either overpay tax or claim too much and invite a notice. Worth getting right.
The least-of-three rule
House Rent Allowance exemption applies under the old tax regime, for people who actually pay rent. The exempt portion is the lowest of these three figures:
- The actual HRA your employer pays you
- The rent you pay minus 10 percent of your salary
- 50 percent of salary if you live in a metro, or 40 percent if you don't
Metro here means Delhi, Mumbai, Kolkata or Chennai. Everywhere else takes the 40 percent figure. Salary for this calculation usually means basic pay plus dearness allowance, not your full CTC, which trips up a lot of people.
Working it out for a Mumbai renter
Let's run an example. Someone in Mumbai with basic salary of Rs 50,000 a month, HRA of Rs 20,000, and rent of Rs 18,000 a month. We'll keep it monthly for clarity.
First figure, the actual HRA received: Rs 20,000.
Second figure, rent minus 10 percent of salary: Rs 18,000 minus Rs 5,000 equals Rs 13,000.
Third figure, 50 percent of salary because Mumbai is a metro: Rs 25,000.
The three come out as Rs 20,000, Rs 13,000 and Rs 25,000. The exemption is the smallest, so Rs 13,000 a month is tax-free. The remaining Rs 7,000 of HRA gets added to taxable income. Notice the rule rewarded the rent paid here, not the generous HRA on the payslip.
Things people miss
A few practical points before you file. You can claim HRA exemption only if you genuinely pay rent and can show proof, so keep receipts and the rent agreement. Pay rent above a yearly threshold and you'll need your landlord's PAN. Living in your own home or paying no rent? Then there's no exemption to claim, even if HRA shows on your slip.
And remember, this benefit sits in the old regime. The new regime drops most such exemptions, so compare both before choosing. Tax rules and thresholds shift with each budget, so check current limits when you file rather than relying on last year's numbers. Used right, HRA is one of the simplest legal ways a renter trims a tax bill.
HRA Calculator — frequently asked questions
How is HRA exemption calculated?
The exempt amount is the least of three figures: the actual HRA you receive, the rent you pay minus 10 percent of your salary, and 50 percent of salary for metro cities or 40 percent for non-metros. You compare all three and the smallest one becomes tax-free. The rest of your HRA is added to taxable income. Salary here usually means basic pay plus dearness allowance, not your full package.
Which cities count as metro for HRA?
Only Delhi, Mumbai, Kolkata and Chennai are treated as metros for HRA purposes. If you live in one of these, you use 50 percent of salary in the calculation. Every other city, including Bengaluru, Hyderabad and Pune, uses the 40 percent figure. This classification is fixed for HRA and does not follow the broader idea of a metro, so check which bracket your city falls into before computing.
Can I claim HRA if I live in my own house?
No. HRA exemption is meant for people who actually pay rent for the home they live in. If you stay in your own house or pay no rent, there is nothing to exempt, even though HRA may still appear on your salary slip. In that case the full HRA becomes taxable. You also cannot claim it for rent paid to yourself, so genuine rent payment is the basic condition.
Is HRA exemption available in the new tax regime?
No, HRA exemption is part of the old tax regime. The new regime offers lower slab rates but removes most exemptions and deductions, including HRA. So if claiming HRA saves you a meaningful amount, the old regime may suit you better. Run both calculations before choosing, since the right answer depends on your rent, salary structure and other deductions. Rules change with each budget, so compare afresh every year.
What documents do I need to claim HRA?
Keep your rent receipts and a valid rent agreement as proof of payment. If your total rent crosses a yearly threshold, you must provide your landlord's PAN to your employer or in your return. Paying rent through bank transfer rather than cash creates a clean trail and helps if questioned. Without proof of genuine rent payment, the exemption can be denied, so maintain these records through the year rather than scrambling at filing time.
Can I claim HRA and a home loan deduction together?
Yes, in certain genuine situations you can claim both. For example, you might own a house in one city on which you pay a home loan, while renting and living in another city for work. As long as both the rent and the home loan are real and you can justify the arrangement, the law allows it. The claims must be honest, since artificial setups to dodge tax can be challenged.
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Results from this calculator are estimates for informational use only — not financial, medical, or professional advice. Read our full disclaimer before acting on any number you see here.