Calculate House Rent Allowance exemption under Section 10(13A) of the Indian Income Tax Act with all three rules, metro/non-metro rates, and tax savings.
House Rent Allowance (HRA) is a common salary component in India that offers significant tax savings under Section 10(13A) of the Income Tax Act. The exemption is calculated as the minimum of three amounts: actual HRA received, rent paid minus 10% of basic salary plus dearness allowance, and 50% (metro) or 40% (non-metro) of basic salary plus DA.
Understanding HRA exemption is crucial for Indian salaried employees as it directly reduces taxable income. The exemption applies only under the old tax regime — employees opting for the new tax regime cannot claim HRA exemption. Metro cities for HRA purposes are Delhi, Mumbai, Chennai, and Kolkata; all other cities are classified as non-metro.
This calculator computes your HRA exemption using all three rules, shows which rule gives the lowest (and therefore applicable) amount, and projects annual tax savings across different income tax slabs. It helps you optimize your rent payments and salary structure for maximum tax efficiency.
HRA exemption is one of the largest tax-saving opportunities for Indian salaried employees. This calculator instantly shows your optimal exemption, identifies the limiting rule, and quantifies annual tax savings — helping you make informed decisions about rent payments and salary structuring.
This tool is designed for quick, accurate results without manual computation. Whether you are a student working through coursework, a professional verifying a result, or an educator preparing examples, accurate answers are always just a few keystrokes away.
HRA Exemption = Minimum of: 1. Actual HRA received from employer 2. Rent paid − 10% of (Basic Salary + DA) 3. 50% of (Basic + DA) for metro cities, or 40% for non-metro Taxable HRA = HRA Received − Exemption Amount
Result: ₹10,000 monthly exemption
Rule 1: ₹20,000 (actual HRA). Rule 2: ₹15,000 − ₹5,000 = ₹10,000. Rule 3: 50% of ₹50,000 = ₹25,000. Minimum is ₹10,000 (Rule 2). Annual exemption: ₹1,20,000.
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HRA exemption allows salaried employees to claim a portion of their House Rent Allowance as tax-free income under Section 10(13A) of the Income Tax Act, reducing taxable income. Use this as a practical reminder before finalizing the result.
Only four cities qualify as metro: Delhi, Mumbai, Chennai, and Kolkata. Employees in these cities get 50% of basic+DA as the Rule 3 limit instead of 40%.
No. HRA exemption requires that you actually pay rent for accommodation. If Rule 2 (rent − 10% of basic) is negative, the exemption is zero.
No. HRA exemption under Section 10(13A) is only available under the old tax regime. The new regime offers lower rates but no HRA deduction.
Yes, you can pay rent to parents and claim HRA exemption. However, the landlord (parent) must declare the rental income. You cannot claim HRA paying rent to your spouse.
Rent receipts, rent agreement, and landlord's PAN (if annual rent exceeds ₹1,00,000). Some employers accept a declaration form for rent payments.