HRA Calculator
Calculate HRA exemption for tax savings — compare all three methods.
Related tools
More in Tax & salary
House Rent Allowance (HRA) is one of the most valuable tax benefits for salaried employees living in rented accommodation. Under Section 10(13A), a portion of your HRA is exempt from tax — potentially saving you thousands every year. Use the calculator above to find the exact exemption amount. Plan your overall taxes with the income tax calculator or check health insurance deductions.
HRA Exemption Examples for Different Cities
| Basic Salary | HRA Received | Rent Paid | City | Exempt HRA |
|---|---|---|---|---|
| ₹6L | ₹3L | ₹2.4L | Mumbai (Metro) | ₹1.80L |
| ₹6L | ₹3L | ₹2.4L | Lucknow (Non-Metro) | ₹1.56L |
| ₹12L | ₹4.8L | ₹4.2L | Delhi (Metro) | ₹3.60L |
| ₹12L | ₹4.8L | ₹4.2L | Jaipur (Non-Metro) | ₹3.12L |
Metro cities: Mumbai, Delhi, Chennai, Kolkata (50% of basic). Non-metro: 40% of basic.
How to Maximize Your HRA Exemption
Pay Rent to Parents
If living with parents, you can pay rent to them. They must declare this as rental income, but if their total income is below the taxable limit, no tax is due.
Keep Proper Documentation
Maintain rent receipts, rental agreement, and landlord PAN (if rent > ₹1L/year). Without these, your employer may not accept HRA exemption.
Claim 80GG If No HRA
If your employer does not provide HRA, you can still claim deduction under Section 80GG for rent paid, subject to limits.
Coordinate with Home Loan
If you own a house in one city but rent in another (work location), you can claim HRA for rent AND home loan interest under Section 24.
How to Calculate HRA Exemption
In plain words
House Rent Allowance (HRA) exemption under Section 10(13A) is calculated as the minimum of three methods. This ensures you get the most beneficial tax treatment. The exemption depends on whether you live in a metro city (Mumbai, Delhi, Chennai, Kolkata — 50%) or non-metro city (40%).
Exempt HRA = Minimum of:
1. Actual HRA Received
2. 50% of Basic Salary (Metro) / 40% of Basic Salary (Non-Metro)
3. Actual Rent Paid - 10% of Basic Salary
Taxable HRA = HRA Received - Exempt HRAA quick example
Let us calculate HRA exemption for an employee in Mumbai:
Step by step
- 1.Method 1 — Actual HRA received: ₹3,00,000
- 2.Method 2 — 50% of basic (metro): 6,00,000 × 50% = ₹3,00,000
- 3.Method 3 — Rent paid - 10% of basic: 2,40,000 - 60,000 = ₹1,80,000
- 4.Exempt HRA = Minimum(3,00,000, 3,00,000, 1,80,000) = ₹1,80,000
- 5.Taxable HRA = 3,00,000 - 1,80,000 = ₹1,20,000
So the answer is: HRA Exemption = ₹1,80,000 | Taxable HRA = ₹1,20,000 | Tax Saved ≈ ₹37,000 (at 30% slab)