Calculate your HRA tax exemption under Section 10(13A) for metro and non-metro cities.
This tool calculates the House Rent Allowance (HRA) tax exemption available to salaried employees in India who live in rented accommodation. HRA exemption reduces taxable income, based on actual rent paid, salary, and city of residence.
HRA exemption is the minimum of: (1) Actual HRA received, (2) Rent paid minus 10% of basic salary, or (3) 50% of basic salary for metro cities (40% for non-metro cities). Whichever of these three amounts is lowest becomes the exempt portion.
Enter your basic salary, actual HRA received, rent paid, and whether you live in a metro city, and the calculator returns your HRA exemption amount and taxable HRA.
Example: With a basic salary of ₹40,000/month, HRA received of ₹20,000/month, and rent paid of ₹18,000/month in a metro city: exemption is the minimum of ₹20,000 (actual HRA), ₹14,000 (rent − 10% of salary = 18,000−4,000), and ₹20,000 (50% of salary) — so ₹14,000 is exempt, with the remaining ₹6,000 taxable.
Why does the exemption use the "lowest of three" rule? This structure ensures the tax benefit reflects actual housing cost relative to income, preventing the exemption from exceeding what's reasonably justified by either the rent paid or the salary-based caps.
What counts as a metro city for HRA purposes? Typically, specific major cities (commonly including Delhi, Mumbai, Kolkata, and Chennai) are classified as metro cities with the higher 50% exemption cap, while all other cities use the 40% cap — check current rules for the exact list.
Can I claim HRA exemption if I don't pay rent? No, HRA exemption specifically requires actually paying rent for residential accommodation — employees who don't pay rent (such as those living in employer-provided or self-owned housing) generally cannot claim this exemption.
Do I need rent receipts to claim HRA exemption? Yes, rent receipts (and often the landlord's PAN for higher rent amounts) are typically required as supporting documentation when claiming HRA exemption, especially if requested by the employer or tax authorities.
Can I claim both HRA exemption and a home loan deduction? In certain circumstances (such as owning a home in a different city than where you work and rent), it may be possible to claim both benefits, though the specific eligibility depends on individual circumstances and current tax rules.