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HRA Calculator

Calculate House Rent Allowance (HRA) tax exemption based on salary, rent paid, and city type. Save income tax on your rent!

HRA Details

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Basic salary per month
₹
DA per month (if applicable)
₹
HRA component in salary
₹
Actual rent you pay

50% exemption in metros, 40% in non-metros

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Enter HRA and rent details

Understanding HRA Exemption

HRA (House Rent Allowance) is a salary component that provides tax exemption for rent paid. The exemption is calculated using 3 formulas, and the lowest amount is exempt from tax.

HRA Exemption Formula

Tax-exempt HRA = Minimum of the following three:

  • Actual HRA received from employer
  • Rent paid minus 10% of (Basic + DA)
  • 50% of (Basic + DA) if metro city (Mumbai, Delhi, Kolkata, Chennai)
  • 40% of (Basic + DA) if non-metro city

Eligibility for HRA Exemption

  • ✅ You must be living in rented accommodation
  • ✅ You must be paying rent (proof required if >₹1L/year)
  • ✅ HRA component must be part of salary structure
  • ✅ Available only under Old Tax Regime
  • ❌ NOT available if you own the house you're living in
  • ❌ NOT available in New Tax Regime

Documents Required

  • Rent receipts: If annual rent >₹1,00,000
  • Landlord's PAN: If annual rent >₹1,00,000
  • Rental agreement: Recommended (not mandatory)
  • Bank statement: Showing rent payments (recommended)

Tips to Maximise HRA Benefit

  • ✅ Ensure HRA is 50% of Basic (standard practice)
  • ✅ Pay rent to parents (legal, but they must show it as rental income)
  • ✅ Keep rent receipts and payment proof
  • ✅ If rent >₹1L/year, collect landlord's PAN
  • ✅ Submit HRA proofs before Feb–Mar (for tax adjustment)
  • ✅ Living in metro? Mention it to employer for 50% exemption

What this HRA calculator does

House Rent Allowance (HRA) is one of the largest tax exemptions a salaried Indian can claim — but only under the old tax regime, and only for the LOWEST of three prescribed amounts. The MONEX MINT HRA calculator applies the Section 10(13A) "lowest-of-three" rule using your basic salary, the actual HRA you receive, the rent you pay and your city tier (metro vs non-metro). It tells you the exempt amount, the taxable balance HRA, and how much tax you save — useful when comparing old vs new regimes, negotiating salary structure, or planning a rental.

How it's calculated

HRA exemption = MIN of three:
  (1) Actual HRA received
  (2) 50% of basic salary (metro) or 40% (non-metro)
  (3) Actual rent paid − 10% of basic salary

Taxable HRA = Total HRA received − Exemption
  • Basic salary — Basic + Dearness Allowance (if part of retirement benefits) for the period you paid rent
  • Metro cities — Mumbai, Delhi, Kolkata, Chennai only — for the 50% cap
  • Non-metro — All other cities including Bengaluru, Hyderabad, Pune, Gurgaon — 40% cap
  • Rent paid — Actual rent in cash or bank transfer; landlord PAN required if annual rent > ₹1L

Example: ₹50,000 basic, ₹25,000 HRA, ₹20,000 rent in Mumbai

  1. Basic = ₹50,000/month | HRA received = ₹25,000/month | Rent paid = ₹20,000/month | City = Mumbai (metro)
  2. Annualise: Basic = ₹6,00,000 | HRA = ₹3,00,000 | Rent = ₹2,40,000
  3. Option 1: Actual HRA received = ₹3,00,000
  4. Option 2: 50% of basic (metro) = ₹3,00,000
  5. Option 3: Rent − 10% of basic = 2,40,000 − 60,000 = ₹1,80,000
  6. Exemption = LOWEST of the three = ₹1,80,000
  7. Taxable HRA = 3,00,000 − 1,80,000 = ₹1,20,000 (added to gross salary)
  8. In the 30% slab, the ₹1,80,000 exemption saves ~₹56,160 of tax annually (incl. cess).

Result: Annual HRA exemption: ₹1,80,000 | Taxable HRA: ₹1,20,000 | Tax saved (30% slab): ~₹56,160

Frequently asked questions

How is HRA exemption calculated under Section 10(13A)?
HRA exemption is the LOWEST of three amounts: (1) actual HRA received from your employer, (2) 50% of basic salary if you live in a metro (Mumbai, Delhi, Kolkata, Chennai) or 40% in any other city, and (3) actual rent paid minus 10% of basic salary. Whichever is lowest is exempt from tax; the rest of your HRA becomes taxable salary income.
Which cities count as metros for HRA?
For HRA purposes the Income Tax Act recognises only four cities as metros: Mumbai, Delhi, Kolkata and Chennai. All other cities — including Bengaluru, Hyderabad, Pune, Gurgaon and Noida — are treated as non-metros for the 40% basic-salary cap, even though many cost as much to live in. The classification is fixed by the IT Act and is not based on Census or municipal status.
Can I claim HRA if I live with my parents?
Yes, provided you actually pay them rent and they declare it as rental income in their ITR. Pay the rent by bank transfer (not cash), execute a simple rent agreement, and ensure your parents own the property. If your monthly rent exceeds ₹8,333 (₹1,00,000 a year), you must furnish your landlord's PAN to your employer; otherwise, the HRA exemption may be denied.
Is HRA exemption available under the new tax regime?
No. The new tax regime (Section 115BAC) does not allow HRA exemption, along with most other deductions. You must opt for the old regime to claim HRA. For salaried employees with a meaningful rent outflow in metro cities, the HRA benefit alone often makes the old regime cheaper, so run both calculators before declaring your regime to the employer.
What documents do I need to claim HRA from my employer?
For monthly rent up to ₹3,000 no proof is needed. Above that, submit rent receipts (one per month or a single annual receipt with revenue stamp for cash payments above ₹5,000). For annual rent above ₹1 lakh, you must additionally provide the landlord's PAN. Keep a rent agreement, bank transfer proof and the landlord's declaration on file in case of an income tax notice.
Can both husband and wife claim HRA on the same rent?
Yes, if both are salaried, both receive HRA, and both contribute to the rent. Split the rent in any reasonable proportion (50-50, 60-40, or based on income) and each spouse claims HRA on their share. Keep separate rent receipts in each name and ensure the landlord acknowledges the split. This often produces a better combined exemption than one spouse claiming the entire amount.
I do not receive HRA — can I still claim a rent deduction?
Yes, under Section 80GG (only in the old regime). The deduction is the LOWEST of: (1) ₹5,000 per month, (2) 25% of total income, or (3) actual rent minus 10% of total income. Maximum ₹60,000 a year. You must not own any residential property in the city where you work, and your spouse and minor children must not own one either. File Form 10BA when filing your ITR.

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HRA exemption is available only under the old tax regime. Calculation uses basic salary including DA forming part of retirement benefits. Always retain rent receipts and bank transfer proof for at least 6 years from the end of the relevant assessment year.