HRA Exemption Calculator — The Three-Rule Test, Solved

Section 10(13A) exempts only the smallest of three amounts. Enter your salary, HRA and rent - see the winning rule, your exact exemption and the tax it saves. Old regime only.

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City Type (for the 50% / 40% rule)

Metro = Delhi, Mumbai, Kolkata, Chennai only. Every other city counts as non-metro for HRA.

Yearly HRA Exemption
₹1.56 L
Set by Rule 2: rent minus 10% of basic
Taxable HRA
₹84,000
added to your taxable salary
Tax Saved at 30% Slab
₹48,672
incl. 4% cess (at 20%: ₹32,448)
Rent for Full Exemption
₹25,000
monthly rent that uses 100% of your HRA
HRA: Exempt vs Taxable
The Three Rules Compared
RuleAmount

📌 Which Rule Is Limiting You?

The Three Rules of Section 10(13A)

Your HRA exemption is the LOWEST of:

1. Actual HRA received  ·  2. Rent paid − 10% of basic  ·  3. 50% (metro) or 40% (non-metro) of basic

Worked Example

Basic ₹6,00,000, HRA received ₹2,40,000, rent ₹18,000/month, metro:

1. HRA received = ₹2,40,000
2. Rent (₹2,16,000) − 10% basic (₹60,000) = ₹1,56,000 ← lowest, wins
3. 50% of basic = ₹3,00,000
Exemption = ₹1,56,000 · Taxable HRA = ₹84,000

HRA Rules People Get Wrong

  • Old regime only: HRA exemption does not exist in the new tax regime. Compare both regimes with the exact deduction in our Income Tax calculator.
  • Only 4 metros: Delhi, Mumbai, Kolkata and Chennai get 50%. Bengaluru, Hyderabad, Pune - all non-metro at 40%.
  • PAN of landlord: Yearly rent above ₹1 lakh needs the landlord's PAN in your return. Rent receipts stay essential proof.
  • Paying parents rent: Allowed and legal - but they must declare the rent as income, and the arrangement must be real (actual transfers, agreement).
  • No rent, no exemption: Living in your own home or rent-free? The entire HRA is taxable.

HRA FAQs

Yes, when they are genuinely for different properties - for example you work and rent in Bengaluru while your owned flat in Jaipur is rented out or your family lives there. You claim HRA on the rent you pay and Section 24 interest (up to ₹2 lakh) on the home loan. Keep documentation for both; the combination is legal but often queried.

Largely, yes in the old regime - Rule 2 (rent minus 10% of basic) caps the exemption no matter how big the HRA component is. The "Rent for Full Exemption" figure above shows the monthly rent at which your HRA becomes fully exempt; beyond that, extra HRA is simply taxable salary.

The exemption is computed month by month - metro status, rent and salary for each month separately, then summed. If you moved from Delhi to Pune in October, the first months count at 50% and the rest at 40%. This calculator assumes a steady year; split a mixed year into two runs and add the results.