HRA Exemption Calculator
If you are a salaried employee living in rented accommodation, the House Rent Allowance (HRA) in your salary can give you a valuable tax break under Section 10(13A) of the Income Tax Act. But the exempt amount is not simply your HRA — it is the lowest of three legally defined figures, which catches many people off guard. This HRA calculator works it out precisely. Enter your basic salary, the HRA you receive, the rent you pay, and whether you live in a metro city, and it shows your exempt HRA and the portion that remains taxable. The exemption is only available under the old tax regime, so the tool also helps you decide whether claiming HRA makes the old regime worthwhile for you.
Metro = Delhi, Mumbai, Kolkata, or Chennai (50% of basic); other cities use 40%.
Exempt HRA
₹1,80,000
Taxable HRA
₹1,20,000
Exemption is the least of:
- Actual HRA received₹3,00,000
- Rent paid − 10% of basic₹1,80,000
- 50% of basic salary₹3,00,000
About the HRA Exemption Calculator
An HRA calculator determines the tax-exempt portion of your House Rent Allowance under Section 10(13A). The exemption is the least of three amounts, so the calculator computes all three and reports the smallest as your exempt HRA.
Why it is useful
Many employees either over-claim HRA and risk a tax notice, or under-claim and pay more tax than necessary. This tool gives the exact exempt figure, helps you plan rent and salary structuring, and informs the old-versus-new regime decision.
How the calculation works
The exempt HRA is the least of: (1) the actual HRA received; (2) rent paid minus 10% of basic salary; and (3) 50% of basic salary if you live in a metro (Delhi, Mumbai, Kolkata, Chennai) or 40% otherwise. Whatever remains of your HRA after the exemption is added to your taxable income.
Key inputs explained
- Basic salary: Basic pay plus dearness allowance, the base for the calculation.
- HRA received: The House Rent Allowance component of your salary.
- Rent paid & city: Annual rent you pay and whether your city is a metro.
Example calculation
Inputs
- Basic salary
- ₹50,000/month
- HRA received
- ₹20,000/month
- Rent / city
- ₹18,000/month / metro
Calculation breakdown
- Actual HRA
- ₹20,000
- Rent − 10% of basic
- 18,000 − 5,000 = ₹13,000
- 50% of basic (metro)
- ₹25,000
The exemption is the lowest of the three figures, ₹13,000. The remaining ₹7,000 of HRA is taxable. Paying higher rent (relative to basic) would raise the exemption up to the other caps.
Benefits
- Pinpoints your exact tax-exempt HRA.
- Helps structure salary and rent for maximum benefit.
- Clarifies whether the old regime is worth it for you.
Limitations
- Available only under the old tax regime.
- Requires you to actually pay rent and keep proof.
- PAN of the landlord is needed if annual rent exceeds ₹1 lakh.
Tips
- Keep rent receipts and the rental agreement as proof.
- Only metros qualify for the 50% limit; other cities get 40%.
- If you live with parents, you can pay them rent and claim HRA, with proper records.
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About this calculator
The HRA Exemption Calculator is built and maintained by the PaisaBot team. All calculations run instantly in your browser using established financial formulas, and we use high-precision arithmetic to keep the results reliable.
Data accuracy: Interest rates, tax slabs, and scheme rules are updated periodically, but figures can change with RBI, government, and lender revisions. Always confirm the latest rates with your bank or an official source before acting.
Educational purpose: This tool is provided for general information and financial education only. It does not constitute investment, tax, or legal advice. For decisions specific to your situation, please consult a qualified financial advisor.