HRA Calculator
Calculate HRA Exemption in Seconds
House Rent Allowance (HRA) is a component of your salary that helps cover rental expenses. Under Section 10(13A) of the Indian Income Tax Act, 1961, HRA can be partially or fully exempt from income tax if you live in rented accommodation.
With PayrollRabbit, you can instantly calculate HRA exemption amounts based on your salary, rent paid, and city of residence. Perfect for salaried employees, tax professionals, and HR managers wanting to determine HRA tax benefits under the old tax regime.
HRA Exemption Calculation Results
The least of the below values is exempt from HRA
Final HRA Calculation
Calculation Formula
Total Salary: Basic Salary + Dearness Allowance = ₹0
10% of Salary: ₹0
Rent in excess of 10%: ₹1,80,000 - ₹0 = ₹0
50% of Basic Salary: ₹5,00,000 × 50% = ₹0
Exempted Amount: Minimum of (₹0, ₹0, ₹0) = ₹0
Step-by-Step Explainer
How is HRA calculated?
Calculate HRA in India in 4 simple steps:
Enter Salary Details
Input employee's annual Basic Salary and any Dearness Allowance (DA). These figures form the base for the HRA calculation.
Provide HRA and Rent Amounts
Enter the total annual House Rent Allowance (HRA) the employee receives from their employer and the total annual rent the employee pays.
Select City Type
Specify whether the employee lives in a metro city (Delhi, Mumbai, Kolkata, Chennai) or a non-metro city to apply the correct calculation rules.
Review Your HRA Exemption
The calculator instantly displays the exempted HRA amount, any taxable portion, and a clear breakdown of the calculation formula.
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Frequently asked questions
Visit our full FAQ page or get in touch with Frederic, Co-Founder of PayrollRabbit.
- HRA is a component of your salary provided by employers to help cover rental expenses. It's a tax-beneficial allowance under Section 10(13A) of the Income Tax Act, 1961, that can be partially or fully exempt from income tax if you live in rented accommodation.
- HRA exemption is calculated as the minimum of three values: (1) Actual HRA received from employer, (2) Rent paid minus 10% of salary (Basic + DA), (3) 50% of basic salary for metro cities or 40% for non-metro cities. The lowest amount among these three is exempt from tax.
- No, you can not claim HRA exemption if you pick the new tax regime, as it is only available to the old tax regime. HRA exemption is an important incluencing factor to choose between old or the new tax regimes.
- For HRA calculation, metro cities are Delhi, Mumbai, Kolkata, and Chennai. In these cities, HRA exemption apply up to 50% of employees basic salary, while in non-metro cities employees can claim up to 40% of basic salary.
- You need rent receipts as proof of rent payment. If your annual rent exceeds ₹1 lakh, your landlord's PAN (Permanent Account Number) is mandatory. For rent below ₹1 lakh, a rent agreement is not mandatory, but rent receipts are advisable as supporting documents.
- No, you cannot claim HRA exemption if you live in your own house. HRA exemption is only available if you live in rented accommodation. If you live in your own property, the entire HRA received from your employer will be fully taxable.
- Yes. If you live in a rented property, but also are paying a home loan for another property, you can claim both HRA exemption and home loan deductions at the same time. But, you need to have justifable reasons why you are not living in your owned property.
- Yes. If your parents are the house owners and declare your payment for rent as income in their income tax returns, you can claim HRA exemption. You must ensure that you have the proper rent receipts and rental agreements.
- If you have deductions such as HRA exemption, Section 80D medical insurance premiums, or Section 80C investments, choose the old tax regime. Choose the new tax regime if you have minimal deductions and want to benefit from lower tax rates and higher standard deduction of ₹75,000.
What is HRA (House Rent Allowance)?
How is HRA exemption calculated?
Does HRA exemption also apply to the new tax regime?
For HRA calculation, which are metro cities?
What documents are required to claim HRA exemption?
Can I claim HRA exemption if I live in my own house?
Is it possible to both HRA exemption and home loan deductions?
Can I pay rent to my parents and claim HRA exemption?
When should I choose old tax or new tax regime?
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Disclaimer: We have taken great care and gave our best effort to ensure the accuracy of the information provided by this HRA Calculator. However, PayrollRabbit does not accept responsibility for any errors or omissions and makes no guarantees or warranties regarding the correctness of the results generated by this free tool. By using this tool, you agree not to hold PayrollRabbit liable for any consequences, issues, or damages arising from any inaccuracies in the results produced. We recommend double-checking all results and contact us if you have any questions, feedback or concerns.