HRA Exemption Calculator — Section 10(13A)
Find out how much of your House Rent Allowance is tax-free and how much stays taxable. 100% private — everything is computed in your browser.
HRA split
Exempt vs taxable HRA
Tax-free HRA (exempt)
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- Share of HRA received
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This much of your HRA escapes tax under Section 10(13A) — in the old regime only.
Taxable HRA
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- Added to your taxable salary
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This portion is taxed at your slab rate, like ordinary salary income.
Which limit bound you?
Exemption = the lowest of these three. The binding one is highlighted.
How HRA exemption works — explained simply
House Rent Allowance is the part of your salary meant to cover rent. Under Section 10(13A) of the Income-tax Act, some of it can be completely tax-free — but only the lowest of three amounts: (1) the actual HRA your employer pays you, (2) your annual rent minus 10% of your (basic salary + DA), and (3) 50% of (basic + DA) if you live in a metro — Delhi, Mumbai, Chennai or Kolkata — or 40% anywhere else. Whatever HRA remains after the exemption is taxable, at your normal slab rate.
Why subtract 10% of salary from rent? The logic is that everyone needs some housing cost, so only rent beyond a tenth of your pay counts as the "extra burden" the exemption rewards. If your rent is less than 10% of salary, condition (2) goes to zero — and since the exemption is the minimum, your whole HRA becomes taxable.
The big catch: HRA exemption exists only under the old tax regime. If you opt for the new regime, your entire HRA is taxable and none of this math applies — a common reason the old regime still wins for renters in expensive cities. Keep rent receipts (and your landlord's PAN if annual rent exceeds ₹1,00,000) for your employer's proof submission; the calculator shows exactly which limit is binding so you can see whether raising rent or moving cities would change your exemption.
Worked examples
Example 1 — Basic ₹6,00,000 · HRA ₹3,00,000 · Rent ₹20,000/mo · Metro
Annual rent = 20,000 × 12 = ₹2,40,000. The three limits: (1) HRA received = ₹3,00,000 · (2) 2,40,000 − 10% of 6,00,000 = ₹1,80,000 · (3) 50% of 6,00,000 = ₹3,00,000. The minimum is ₹1,80,000 exempt, leaving ₹1,20,000 taxable.
Example 2 — Same numbers, but non-metro
Limits become (1) ₹3,00,000 · (2) ₹1,80,000 · (3) 40% of 6,00,000 = ₹2,40,000. Exemption is still ₹1,80,000 — here the rent-minus-10% condition binds in both cases, which is typical when HRA is generous relative to salary.
Example 3 — Basic ₹12,00,000 · HRA ₹4,00,000 · Rent ₹45,000/mo · Metro
Annual rent = ₹5,40,000. Limits: (1) ₹4,00,000 · (2) 5,40,000 − 1,20,000 = ₹4,20,000 · (3) ₹6,00,000. Minimum = ₹4,00,000 — the full HRA is exempt, taxable HRA ₹0. When your actual HRA is the binding limit, every rupee of it escapes tax.
Frequently asked questions
Is HRA exemption available under the new tax regime?
No. The new regime (Section 115BAC) disallows the HRA exemption under Section 10(13A) — your entire HRA becomes taxable salary. If you pay significant rent, this alone can make the old regime cheaper. This calculator's result only applies if you opt for the old regime.
What documents do I need to claim HRA exemption?
Rent receipts for the rent you paid, and your landlord's PAN if your annual rent exceeds ₹1,00,000. Most employers ask for these during the investment-proof submission window (usually January). Keep them even if you file yourself.
Can I claim HRA if I own the house I live in?
No — HRA exemption requires you to actually pay rent for your residence. If you live in your own house and pay no rent, the full HRA is taxable. (You may still claim home-loan interest under Section 24(b) in the old regime, which is a separate deduction.)
Can I pay rent to my parents and claim HRA?
Yes, if it's genuine: you must actually live in the rented accommodation, pay real rent (ideally by bank transfer), and your parent must declare that rental income in their tax return. Fabricated arrangements can be disallowed on scrutiny — keep receipts and a rent agreement.
Which cities count as metro for HRA?
Only four: Delhi, Mumbai, Chennai and Kolkata. Every other city — including Bengaluru, Hyderabad, Pune and Ahmedabad — is non-metro for this rule, so the salary-percentage cap is 40% instead of 50%.
What if my rent is less than 10% of my salary?
Then condition (2) — rent minus 10% of salary — becomes zero or negative, and since the exemption is the minimum of the three limits, your exemption is zero. The entire HRA is taxable in that case.
Is dearness allowance included in "salary" for HRA?
Yes — "salary" for this calculation means basic pay plus dearness allowance (if DA forms part of retirement benefits), plus commission as a fixed percentage of turnover. Allowances like conveyance or special allowance are not included.
My employer didn't split out HRA — can I still claim?
No. The exemption applies to HRA actually received as part of your salary structure. If your CTC has no HRA component, there is nothing to exempt — though you may claim a deduction under Section 80GG (up to ₹60,000/year) if you pay rent and receive no HRA, subject to its own conditions.
Does the exemption change if I move cities mid-year?
Strictly, it's computed month by month — metro months use the 50% cap and non-metro months the 40% cap, with rent and salary apportioned. Most salaried taxpayers use the city where they lived longest, but for a fully accurate figure, compute each period separately. This calculator assumes one city for the whole year.
Is this calculator's result final?
It's an estimate under Section 10(13A) with standard assumptions (old regime, single city, full-year tenancy). Special situations — rent-free accommodation, composite rent, or employer-owned housing — have their own valuation rules. Confirm with a chartered accountant before filing.
Disclaimer: This is an estimate for illustration, computed in your browser — no data leaves your device. The HRA exemption applies only under the old tax regime. Figures must be verified against the Income-tax Act before reliance. Consult a chartered accountant for filing.