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About the HRA Calculator
House Rent Allowance is one of the largest exemptions available to a salaried employee in India, and it is also one of the most commonly miscalculated — because the exempt amount is not the HRA your employer pays you. It is the least of three separate figures, and this calculator works out all three and shows you which one applies.
The least-of-three rule
Under Section 10(13A), your exempt HRA is the smallest of: the actual HRA received from your employer; the rent you paid minus 10% of your salary; and 50% of salary if you live in a metro city or 40% anywhere else. “Salary” here means basic pay plus dearness allowance, not your full CTC. Whatever is left over after the exemption is added to your taxable income.
What counts as a metro
For HRA purposes only four cities qualify: Delhi, Mumbai, Kolkata and Chennai. Bengaluru, Hyderabad, Pune and every other city are treated as non-metro at 40%, however expensive their rent may be. This trips up a lot of people, so it is worth checking before you plan around a figure.
A worked example
Basic plus DA of ₹40,000 a month, HRA of ₹18,000 a month, rent of ₹20,000 a month in Mumbai. Annually that is ₹4,80,000 salary, ₹2,16,000 HRA and ₹2,40,000 rent. The three limits come out at ₹2,16,000 (actual HRA), ₹1,92,000 (rent minus 10% of salary) and ₹2,40,000 (50% of salary). The least is ₹1,92,000, so that much is exempt and the remaining ₹24,000 of HRA is taxable.
Conditions worth knowing
The exemption is available only under the old tax regime — it does not apply if you have opted for the new regime. You must genuinely pay rent, and you cannot claim it for a house you own and live in. If your annual rent crosses ₹1,00,000 you have to give your landlord’s PAN to your employer, and you should keep receipts. To generate those receipts, use the Rent Receipt Generator, and to estimate the tax on the remainder see the Income Tax Calculator.
Frequently Asked Questions
How is HRA exemption calculated?
It is the least of three amounts: the actual HRA received, the rent you paid minus 10% of your basic salary plus DA, and 50% of that salary if you live in a metro or 40% if you do not. The smallest of the three is exempt; the rest is taxable.
Which cities count as metro for HRA?
Only Delhi, Mumbai, Kolkata and Chennai. Every other city, including Bengaluru, Hyderabad and Pune, is treated as non-metro and uses the 40% limit.
Can I claim HRA under the new tax regime?
No. The Section 10(13A) exemption is available only under the old regime. If you have opted for the new regime, your entire HRA is taxable.
Do I need rent receipts and my landlord’s PAN?
Keep rent receipts as proof. If your rent exceeds ₹1,00,000 in a financial year, you must also report your landlord’s PAN to your employer to claim the exemption.
Can I claim HRA if I pay rent to my parents?
Yes, provided the arrangement is genuine — your parents must actually own the property and must declare the rent as income in their own return. Keep receipts and pay by bank transfer.
Is my salary data stored?
No. The calculation runs entirely in your browser and nothing you type is uploaded or saved.