HRA Exemption Calculator
Calculate the HRA exemption you can claim under the old regime per Section 10(13A). Free HRA calculator with metro and non metro rules for FY 2025-26.
House Rent Allowance, or HRA, is a salary component that offers significant tax savings if you live in rented accommodation and choose the old tax regime. The exemption is governed by Section 10(13A) of the Income Tax Act and is the least of three values, computed against your basic salary, the rent you actually pay and your city of residence. The HRA calculator on this page does the three way comparison instantly and tells you exactly how much HRA you can claim as exempt.
HRA Inputs
How exemption is calculated
HRA exemption = least of these three values, per Section 10(13A):
| 1. Actual HRA received | ₹2,40,000 |
| 2. Rent paid − 10% of basic | ₹1,80,000 |
| 3. 50% of basic salary | ₹3,00,000 |
Why use the HRA Exemption Calculator
HRA is one of the largest tax saving levers under the old regime, especially for renters in metros. A salaried employee in Mumbai paying 30,000 per month rent on a 50,000 basic can typically claim 2.4 lakh annual HRA exemption, which translates to up to 75,000 in tax saved at the 30 percent slab. Yet most employees are unsure how the exemption is computed and either over claim (risk of notice) or under claim (lose the saving). The calculator removes the ambiguity by walking through the rules and showing the exact answer.
Benefits at a glance
All three Section 10(13A) rules computed
The calculator shows actual HRA received, rent paid minus 10 percent of basic and 50 percent (metro) or 40 percent (non metro) of basic. The exempt portion is the lowest of the three, which is the rule the income tax department applies.
Metro versus non metro toggle
Mumbai, Delhi, Kolkata and Chennai qualify for the 50 percent of basic limit. All other cities including Bangalore, Hyderabad, Pune and Ahmedabad use 40 percent. The calculator handles both with a single switch.
Useful at offer letter and tax filing time
Use the calculator when negotiating salary structure (a higher basic and HRA can save tax for renters), when submitting investment proofs to your employer, and when filing the return.
Shows the taxable portion of HRA
Whatever HRA exceeds the exempt portion is added to your taxable salary. The calculator splits the total HRA into exempt and taxable so you know the net tax impact.
How to use the HRA Exemption Calculator
- 1
Enter your annual basic salary
Use basic plus dearness allowance (where applicable). The HRA exemption is computed against basic plus DA, not against the full CTC.
- 2
Enter the annual HRA received
The HRA component of your salary as per the offer letter or pay slip. Annual figure, not monthly.
- 3
Enter the annual rent paid
Total rent you paid through the year. If you stayed in rented accommodation for part of the year, count only those months. If you paid rent to your parents (allowed if they own the property), include it but expect to provide rent receipts.
- 4
Tick metro if you live in Mumbai, Delhi, Kolkata or Chennai
These four cities qualify for the 50 percent of basic upper bound. All others use 40 percent. The Income Tax Department has not added Bangalore or Hyderabad to the metro list despite their economic status.
- 5
Read the exempt and taxable portions
The exempt portion is the maximum HRA you can claim. The taxable portion is added to your salary for income tax. Submit rent receipts and the landlord's PAN (if rent exceeds 1 lakh per year) to your employer to claim the exemption in TDS.
Frequently asked questions
How is HRA exemption calculated?
Exempt HRA is the least of three values: (1) actual HRA received, (2) rent paid minus 10 percent of basic salary, (3) 50 percent of basic salary if you live in a metro (Mumbai, Delhi, Kolkata, Chennai) or 40 percent if you live in a non metro. The smallest of the three is the maximum exemption. The remainder of your HRA is added to taxable salary.
Is HRA available under the new regime?
No. The new regime, including FY 2025-26, does not allow HRA exemption. If you are a renter with a meaningful HRA component and significant rent, the old regime may still be more tax efficient despite the higher slab rates. Run the income tax calculator to compare both regimes for your specific salary and rent.
Can I claim HRA if I pay rent to my parents?
Yes, provided your parents legally own the property, you actually pay them rent (via bank transfer for clarity), and the rent is reasonable for the locality. Your parents must declare the rent as income in their return. The arrangement is legitimate but is a common audit trigger, so keep a written rent agreement and bank transfer records.
What documents do I need to claim HRA exemption?
Rent receipts for the months you paid, the landlord's PAN if your annual rent exceeds 1 lakh (mandatory) and a written rent agreement. Some employers also ask for the bank statements showing rent transfers. Submit these to your employer's payroll team to claim HRA in your TDS, or keep them for your records when filing the return directly.
Can I claim HRA and home loan interest at the same time?
Yes, in some cases. If your home loan is on a property in a city different from where you work and live in a rented house, you can claim HRA on the rented house and home loan interest on the owned property. If both properties are in the same city, the income tax department often disallows both, and you should consult a CA before claiming both.
What if I do not have HRA in my salary?
If your CTC does not include an HRA component (rare but possible in some industries or smaller employers), you cannot claim HRA exemption. You may be able to claim Section 80GG instead if you pay rent for accommodation, with a maximum deduction of 60,000 per year subject to specific conditions including not owning any residential property in the location of your employment.
Does HRA exemption apply if I work from home?
Yes, if you actually live in rented accommodation and pay rent. The location of your employer's office does not affect HRA eligibility. Working remotely from a different city does not disqualify you from claiming HRA on your rent in that city.
Final word
HRA exemption is one of the cleanest tax saving levers for renters under the old regime. Run the calculator before submitting investment proofs to your employer and again at tax filing time to make sure you are claiming the right amount. If you have flexibility in your salary structure, restructuring to a higher basic and HRA can boost the exemption further, particularly in metro cities where the 50 percent of basic limit becomes the binding constraint.
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