House Rent Allowance Calculator
Calculate HRA exemption under Section 10(13A) of Income Tax Act
HRA Calculation Results
Annual HRA Received
₹ 2,40,000
Annual Rent Paid
₹ 3,00,000
HRA Exemption Calculation
1. Actual HRA Received
₹ 2,40,000
2. Rent paid minus 10% of basic salary
₹ 2,40,000
3. 50%/40% of basic salary
₹ 3,00,000
Minimum of above three (Exempt HRA)
₹ 2,40,000
Tax Impact
Taxable HRA
₹ 0
Tax Savings (30% slab)
₹ 72,000
Effective Monthly Saving
₹ 6,000
Understanding HRA Calculation
What is HRA?
House Rent Allowance (HRA) is a component of salary provided by employers to employees for meeting rental expenses of residential accommodation. A portion of HRA is exempt from tax under Section 10(13A) of the Income Tax Act.
How HRA Exemption is Calculated
The HRA exemption is the least of the following three amounts:
- Actual HRA received from employer
- Actual rent paid minus 10% of basic salary
- 50% of basic salary for metro cities (Mumbai, Delhi, Kolkata, Chennai) or 40% of basic salary for non-metro cities
Key Points to Remember
- You must actually pay rent to claim HRA exemption
- Rent receipts should be maintained as proof
- If you live with parents, you can still claim HRA by paying rent to them
- If your spouse owns the house, you cannot claim HRA exemption
- Pan card of landlord is required if annual rent exceeds ₹1,00,000
Example Calculation
For an employee in Mumbai with:
- Basic Salary: ₹50,000 per month
- HRA Received: ₹20,000 per month
- Rent Paid: ₹25,000 per month
The exemption would be calculated as:
- Actual HRA: ₹2,40,000 (annual)
- Rent paid - 10% of basic: ₹3,00,000 - ₹60,000 = ₹2,40,000
- 50% of basic salary: ₹3,00,000
Exempt HRA: Minimum of above = ₹2,40,000