HRA exemption calculator — how much house rent allowance is tax-free
Enter your basic salary, the HRA on your payslip and the rent you actually pay. You get the exempt and taxable HRA, all three limits of Rule 2A side by side so you can see which one caps you, and the tax that exemption saves at your slab.
In Short
Your HRA exemption is the lowest of three amounts: the actual HRA received, the rent you paid minus 10% of salary, and 50% of salary if you live in Delhi, Mumbai, Kolkata or Chennai (40% anywhere else). Salary here means basic pay plus any dearness allowance forming part of pay. The exemption sits under Section 10(13A) and is available only in the old tax regime. Rent receipts are needed in every case, and your landlord's PAN once rent crosses ₹1,00,000 a year.
Your salary and rent
Monthly figures, as on your payslip and rent agreement.
₹/mo
₹5,000₹5,00,000
Basic pay only — exclude bonus, overtime and other allowances.
₹/mo
₹0₹2,00,000
Include only DA that forms part of pay for retirement benefits. Zero for most private employers.
₹/mo
₹0₹3,00,000
The house rent allowance line on your payslip.
₹/mo
₹0₹4,00,000
Rent actually paid for the house you occupy. Maintenance and brokerage do not count.
Only Delhi, Mumbai, Kolkata and Chennai count as metro.
Old regime rate on the slice of income the exemption removes.
Your exemption for the year
Exempt HRA
₹1,92,000
₹16,000 a month
Taxable HRA
₹96,000
67% of HRA is tax-free
The three limits — lowest wins
Actual HRA received₹2,88,000
₹24,000 × 12
Rent paid − 10% of salary₹1,92,000
Lowest — this caps your exemption · ₹2,64,000 − ₹72,000
40% of salary₹2,88,000
40% × ₹7,20,000 (non-metro)
Tax saved at the 30% slab₹59,904
Rent minus 10% of salary is your binding limit, so every extra ₹100 of rent adds ₹100 of exemption until you hit the 40% ceiling.
Rent of ₹2,64,000 a year is above ₹1,00,000, so you must report your landlord’s PAN to your employer. No PAN means a signed declaration plus Form 60.
At your salary and HRA the exemption climbs ₹1 for every ₹1 of rent above ₹6,000 a month, then flattens at ₹2,88,000 once rent passes about ₹30,000 a month. You are the dot.
₹0 rent₹11k/mo₹22k/mo₹33k/mo₹44k/mo
What is HRA exemption?
House Rent Allowance is a salary component paid to cover the cost of rented accommodation. Section 10(13A) of the Income-tax Act, read with Rule 2A, keeps part of it out of your taxable salary — but only to the extent you actually pay rent for a house you occupy.
Because the exemption is capped by three separate tests, the binding constraint differs from person to person. Someone in a small rented flat is usually capped by rent minus 10% of salary; someone with a modest HRA component is capped by HRA received; a high earner paying heavy rent hits the 50% or 40% of salary ceiling. If you rent no house or pay no rent, nothing is exempt.
The rule
Exempt HRA = min ( H, R − 0.10 S, k × S )
H — actual HRA received during the year
R — rent actually paid during the year
S — salary: basic + DA forming part of pay + commission as % of turnover
k — 0.50 for Delhi, Mumbai, Kolkata, Chennai; 0.40 elsewhere
Compute period by period whenever salary, HRA, rent or city changes mid-year, then add the results. Bonuses, overtime and other allowances are excluded from S.
Worked example
A salaried employee in Bengaluru on ₹60,000 basic a month, receiving ₹24,000 HRA and paying ₹22,000 rent.
Limit 3 — 40% of salaryBengaluru is non-metro₹2,88,000
Exempt HRALowest of the three — limit 2 binds₹1,92,000
Taxable HRA₹2,88,000 − ₹1,92,000₹96,000
Tax saved at 30%₹1,92,000 × 30% × 1.04 cess₹59,904
Metro vs non-metro at a glance
The 50% rate applies to four cities only. Everywhere else — including Bengaluru, Hyderabad, Pune and the NCR satellites — the ceiling is 40% of salary.
Delhi
50% of salary
Mumbai
50% of salary
Kolkata
50% of salary
Chennai
50% of salary
Bengaluru
40% of salary
Hyderabad
40% of salary
Pune
40% of salary
Gurugram
40% of salary
Noida
40% of salary
Ahmedabad
40% of salary
Jaipur
40% of salary
Kochi
40% of salary
Proof your employer and the department expect
HRA claims are a standard scrutiny item. Keep this set on file for every year you claim.
DocumentWhat it must show
Rent receiptsMonthly or quarterly receipts with the landlord's name, address, amount, period and signature. Revenue stamp where rent is paid in cash above ₹5,000.
Rent agreementA registered or notarised agreement naming you as tenant, with the rent amount and period matching your receipts.
Landlord PANMandatory once annual rent exceeds ₹1,00,000. Where the landlord has no PAN, a declaration with Form 60 is accepted.
Payment trailBank transfer or UPI to the landlord's account each month. Cash rent with no trail is the single most common reason HRA claims are rejected.
Rent to parentsOwnership proof for the parent, an actual transfer each month, and the rent declared as house property income in the parent's return.
Declaration to employerForm 12BB with rent details, filed with your employer so the exemption reflects in your TDS and Form 16.
HRA, 80GG and the new regime
Which route applies depends on whether HRA is part of your salary and which regime you file under.
HRA — Sec 10(13A)80GGNew regime
Who can claimSalaried employees receiving HRAAnyone paying rent with no HRA in salaryNo rent relief at all
CeilingLowest of the three Rule 2A limitsLowest of ₹5,000/mo, 25% of total income, rent − 10% of income—
RegimeOld regime onlyOld regime onlyNew regime
PaperworkForm 12BB, receipts, landlord PAN above ₹1 lakhForm 10BA plus receiptsNone
CatchNeeds rent actually paid for a house you occupyNo family member may own a house where you work or resideLower slab rates instead of exemptions
Frequently Asked Questions
Under Rule 2A the exemption is the lowest of three amounts: actual HRA received, rent paid minus 10% of salary, and 50% of salary in Delhi, Mumbai, Kolkata or Chennai (40% elsewhere). Salary means basic pay plus DA forming part of pay plus commission fixed as a percentage of turnover — nothing else.
