Calculate your HRA tax exemption instantly with our comprehensive House Rent Allowance Calculator. Designed for central government, state government, PSU, and private sector employees. Get detailed breakdowns for metro and non-metro cities with visual insights.
Calculate your House Rent Allowance exemption instantly with our advanced calculator supporting Central Govt, Defence, PSU, State Govt, Academic Staff, and Bank Employees. Government employees get HRA based on city categories:X cities (Delhi, Mumbai, Chennai, Kolkata): 30%,Y cities (Major state capitals): 20%,Z cities (All other cities): 10%. Private employees can enter custom HRA percentages. Select your category, pay level, and let the system automatically calculate DA and HRA exemption with detailed breakdowns!
7th Pay Commission - Central Government Employees
Actual rent paid to landlord
HRA shown in your salary slip
X Cities: Delhi, Mumbai, Chennai, Kolkata | Y Cities: Major state capitals | Z Cities: All other cities
Select your income tax bracket
Input your monthly basic salary and Dearness Allowance (DA). For government employees, DA is typically a percentage of basic pay. Private employees can enter 0 if no DA is provided.
Enter the actual monthly rent you pay to your landlord. Ensure you have proper rent receipts and documentation. If annual rent exceeds ₹1 lakh, landlord's PAN is required.
Enter the monthly HRA component shown in your salary slip. This is the amount your employer pays as House Rent Allowance. Check your CTC breakdown or payslip.
Choose Metro (Mumbai, Delhi, Kolkata, Chennai - 50% limit) or Non-Metro (all other cities - 40% limit). This affects your maximum HRA exemption calculation.
Save your calculations by bookmarking this page or taking a screenshot of the results. Use the visual charts to understand your tax savings better and plan your finances accordingly.
HRA exemption is calculated as the MINIMUM of the following three:
Actual HRA Received from employer
50% of (Basic + DA) for Metro cities OR 40% of (Basic + DA) for Non-Metro cities
Rent Paid - 10% of (Basic + DA)
Basic Salary: ₹50,000
DA: ₹10,000
Monthly Rent: ₹20,000
HRA Received: ₹25,000
City Type: Metro (50%)
Calculation:
Exemption: ₹14,000 (Minimum)
Basic Salary: ₹40,000
DA: ₹8,000
Monthly Rent: ₹15,000
HRA Received: ₹18,000
City Type: Non-Metro (40%)
Calculation:
Exemption: ₹10,200 (Minimum)
| Employee Type | Metro Rate | Non-Metro Rate | Key Rules |
|---|---|---|---|
| Central Govt | 24% of Basic + DA | 16% or 8% of Basic + DA | 7th CPC rates, DA included when it forms part of retirement benefits |
| State Govt | Varies by state | Varies by state | Follow respective state pay commission rules |
| PSU Employees | As per CTC | As per CTC | HRA component defined in salary structure, follows IT rules |
| Private Sector | 50% exemption limit | 40% exemption limit | Section 10(13A), rent receipts mandatory |
50% Exemption Limit
Includes:
Higher exemption due to higher rental costs in these cities
40% Exemption Limit
Includes:
Lower exemption limit applicable to all non-metro cities
House Rent Allowance (HRA) is a salary component provided by employers to employees to meet their accommodation expenses when living in rented premises. HRA is a crucial part of salary structure for both government and private sector employees, offering significant tax benefits under Section 10(13A) of the Income Tax Act, 1961.
For central and state government employees, HRA calculation is governed by specific rules based on 7th Pay Commission recommendations. The amount varies depending on whether the employee is stationed in a metro city (classified as X category) or non-metro city (Y and Z categories). Metro cities include Mumbai, Delhi, Kolkata, and Chennai.
The tax exemption on HRA helps reduce taxable income, making it one of the most valuable components of salary structure. Understanding HRA calculation is essential for tax planning and maximizing take-home salary. This calculator helps you determine the exact tax-free portion of your HRA based on your salary structure, rent paid, and city classification.
Under Section 10(13A) of the Income Tax Act, HRA exemption is calculated as the minimum of: (a) Actual HRA received, (b) 50% of basic salary for metro cities (Mumbai, Delhi, Kolkata, Chennai) or 40% for non-metro cities, (c) Rent paid minus 10% of basic salary. If you live in your own house or don't pay rent, you cannot claim HRA exemption.
Yes, you can claim HRA exemption even if you live with your parents. You need to pay rent to them and maintain proper documentation including rent receipts. Your parents must declare this rental income in their income tax returns. If annual rent exceeds ₹1 lakh, PAN of the landlord (parent) is mandatory. However, this arrangement must be genuine and not created solely for tax benefits.
For HRA calculation, metro cities include Mumbai, Delhi, Kolkata, and Chennai where 50% of basic salary is considered. For all other cities (non-metro), 40% of basic salary is used. This affects the maximum exemption you can claim. For example, if your basic salary is ₹50,000, metro exemption limit is ₹25,000 while non-metro is ₹20,000 before comparing with actual rent paid.
For HRA exemption calculation, only Basic Salary and Dearness Allowance (DA) are considered. Basic salary is the fixed component excluding all allowances. DA is added only if it forms part of retirement benefits. Other allowances like special allowance, transport allowance, bonus, or incentives are not included in the calculation base.
Yes, rent receipts are mandatory proof for claiming HRA exemption. If monthly rent exceeds ₹3,000, you must submit rent receipts to your employer. If annual rent exceeds ₹1 lakh, you must provide landlord's PAN details. Rent receipts should include: landlord's name and address, rental period, amount paid, revenue stamp (if applicable), and landlord's signature.
Yes, you can claim both HRA exemption and home loan benefits simultaneously if you satisfy these conditions: (1) You must be paying rent for the house where you live, (2) The owned house (for which home loan is taken) must be in a different city, (3) The owned house should not be occupied by you due to employment in another city. You need to prove genuine need for rented accommodation.
For central and state government employees, HRA is calculated using the same formula but with specific rules: Basic Pay + DA (if applicable) is used as the base. Metro/non-metro classification follows the same 50%/40% rule. Government employees can claim actual HRA received or calculated exemption, whichever is lower. 7th Pay Commission employees should note that DA is considered only after it's merged with basic pay or declared as part of retirement benefits.
HRA exemption has a ceiling based on the formula. Even if you pay very high rent, your exemption is limited to the minimum of: (a) Actual HRA received from employer, (b) 50%/40% of basic salary, (c) Rent paid minus 10% of basic salary. Any amount above this remains taxable. It's advisable to negotiate salary structure with your employer to optimize tax benefits if you pay substantially high rent.
No, HRA exemption under Section 10(13A) is available only for salaried individuals who receive HRA as part of their salary package. Self-employed individuals and business owners cannot claim HRA exemption. However, they can claim rent paid as a business expense under Section 30 if they use the rented premises for business purposes, subject to specific conditions and documentation.
If your employer doesn't provide HRA as a salary component, you cannot claim exemption under Section 10(13A). However, you can claim deduction under Section 80GG if: (1) You don't receive HRA, (2) You're not self-employed, (3) You, spouse, or children don't own residential accommodation in the city of employment. Maximum deduction under 80GG is ₹5,000 per month or 25% of total income, whichever is lower.