Calculate House Rent Allowance (HRA) tax exemption under Section 10(13A) of the Income Tax Act. Determine exempt HRA, taxable HRA, and tax savings across metro (50%) and non-metro (40%) cities.
Under Section 10(13A) and Rule 2A of the Income Tax Rules, salaried employees residing in rented accommodations can claim HRA exemption under the Old Tax Regime. The exemption equals the lowest of three statutory amounts: actual HRA received, 50% (metro) or 40% (non-metro) of Basic+DA, or rent paid minus 10% of Basic+DA.
Calculate HRA exemption, taxable HRA, and tax-saving benefits instantly.
Metros for HRA 50% limit are strictly defined as Delhi, Mumbai, Kolkata, and Chennai (all other cities qualify for 40%). Landlord's PAN is mandatory on Form 12BB if annual rent paid exceeds ₹1,00,000 (₹8,333/month).
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ViewInput your annual Basic Salary plus Dearness Allowance (DA forming part of retirement benefits).
Enter the gross HRA allowance component as stated on your salary slips / CTC structure.
Enter the total actual rent paid to your landlord across the 12-month financial year.
Choose Metro (Delhi, Mumbai, Kolkata, Chennai for 50%) or Non-Metro (all other cities for 40%).
Exempt HRA = minbegin{cases} Actual HRA Received 50% (Metro) or 40% (Non-Metro) of (Basic + DA) Actual Rent Paid - 10% of (Basic + DA) end{cases}
The exempt portion of House Rent Allowance is the minimum of: (1) Actual HRA received from your employer, (2) 50% of Basic Salary for metro cities or 40% for non-metro cities, or (3) Rent paid minus 10% of Basic Salary. Taxable HRA is calculated as Actual HRA minus Exempt HRA.
Input: Basic Salary: ₹6,00,000 | HRA Received: ₹2,40,000 | Rent Paid: ₹2,16,000 (₹18,000/mo) | City: Bangalore (Non-Metro 40%)
Output: Condition 1: ₹2,40,000 | Condition 2 (40%): ₹2,40,000 | Condition 3 (Rent - 10%): ₹2,16,000 - ₹60,000 = ₹1,56,000 → Exempt HRA: ₹1,56,000 | Taxable HRA: ₹84,000
No. Under the New Tax Regime, exemptions under Section 10(13A) for House Rent Allowance are completely omitted. If you choose the New Tax Regime, your entire HRA component is included in your taxable salary income. HRA exemption is exclusively available under the Old Tax Regime.
Under Rule 2A of the Income Tax Rules (formulated in 1962), the 50% salary threshold is statutory and legally restricted to the four historical presidency cities (Delhi, Mumbai, Kolkata, Chennai). Major IT hubs like Bangalore, Hyderabad, Pune, and Gurgaon are officially categorized as Non-Metro (40% limit) for income tax purposes, despite their high cost of living.
Yes, as per CBDT Circular guidelines, if your annual rent payments exceed ₹1,00,000 (which equals ₹8,333 per month), you must mandatorily provide your landlord's PAN on Form 12BB to your employer. If the landlord does not possess a PAN, a signed declaration under Form 60 must be submitted.
Yes, paying rent to your parents is legally permissible under Section 10(13A), provided: (1) your parents are the legal owners of the residential property, (2) you execute a genuine registered or notarized rent agreement, (3) you transfer rent via bank transfer, and (4) your parents declare this rental income in their personal Income Tax Returns (ITR). You cannot pay rent to your spouse.
Yes, you can claim both HRA exemption and Home Loan deductions if: (1) your own home is in a different city due to your employment posting, or (2) your own home is under construction, or (3) your owned home is rented out to a tenant while you live in a rented house closer to your workplace. You must maintain genuine proof of residence.
House Rent Allowance (HRA) is one of the most substantial tax-saving allowances available to salaried employees in India. However, unlike flat deductions, HRA is not completely tax-free by default; exemption is determined using a statutory three-part mathematical test under Rule 2A of Income Tax Rules.
---| Condition | Legal Basis | Metro Cities (Delhi, Mumbai, Kolkata, Chennai) | Non-Metro Cities (Bangalore, Hyderabad, Pune, etc.) |
|---|---|---|---|
| Condition 1 | Actual Allowance | Actual HRA received from employer | Actual HRA received from employer |
| Condition 2 | Salary Percentage | 50% of (Basic Salary + DA) | 40% of (Basic Salary + DA) |
| Condition 3 | Rent Outflow Test | Actual Rent Paid − 10% of (Basic Salary + DA) | Actual Rent Paid − 10% of (Basic Salary + DA) |
Final Rule: The lowest numeric value among the three conditions above is completely exempt from income tax. Any remaining balance of your received HRA is added to your gross taxable income.
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Aditya Singh is a software engineer and the founder of DevCalc, based in Uttar Pradesh, India. He builds and maintains every calculator on this site using documented formulas, worked examples, and clearly stated limitations, with careful attention to accuracy. Read more about the author →
This calculator and its guidance are for general educational purposes only and do not constitute financial, investment, or tax advice. Verify figures with a qualified professional before making financial decisions.
