HRA Exemption Calculator
India, Section 10(13A). Your House Rent Allowance is not fully tax-free — only the smallest of three legal limits is. Enter four numbers and see exactly how much escapes tax.
Monthly figures
Result
The three limits
The law allows the smallest of these three. Yours is highlighted.
Your rent is less than 10% of Basic + DA, so no HRA exemption is available.
HRA exemption exists only under the old tax regime. The new regime does not allow it. If your annual rent crosses ₹1,00,000 you must report your landlord's PAN to your employer.
The rule in one line
Exemption = MIN( HRA received, Rent − 10% × (Basic + DA), 50%/40% × (Basic + DA) )
Two things trip people up. First, the calculation runs on Basic + DA, never on gross salary or CTC — a high CTC with a low Basic gives you a small exemption. Second, the metro list is exactly four cities: Delhi, Mumbai, Kolkata and Chennai. Bengaluru, Pune, Hyderabad and Gurugram are non-metro for this section, however expensive they have become.
Paperwork you need to keep
- Rent receipts — monthly or quarterly, signed by the landlord.
- Rent agreement — most employers ask for it above ₹50,000/month.
- Landlord's PAN — mandatory once annual rent crosses ₹1,00,000.
- TDS at 2% under Section 194-IB if you pay over ₹50,000/month as an individual.
Paying rent to a parent is legal and commonly done, but the rent must actually be transferred, the parent must own the property, and it becomes taxable income in their hands. Cash "receipts" with no bank trail are the single most-litigated HRA claim.
Frequently asked questions
How is HRA exemption calculated?
The exemption is the smallest of three amounts: (1) the actual HRA you receive, (2) rent paid minus 10% of Basic + DA, and (3) 50% of Basic + DA if you live in a metro, or 40% elsewhere. Whichever is lowest becomes tax-free; the rest of your HRA is taxable salary.
Which cities count as metro for HRA?
Only four: Delhi, Mumbai, Kolkata and Chennai. Bengaluru, Hyderabad, Pune, Gurugram and Noida are all non-metro for Section 10(13A), so they get the 40% limit — however expensive rent there has become.
Can I claim HRA under the new tax regime?
No. HRA exemption is available only under the old regime. This is one of the main reasons employees who rent in expensive cities still find the old regime cheaper — use the old vs new regime calculator to check your own case.
Can I pay rent to my parents and claim HRA?
Yes, and it is entirely legal, but the arrangement must be real. The property must be owned by the parent, the rent must actually be transferred by bank so there is a trail, and the parent must declare it as rental income in their own return. Cash receipts with no bank transfer are the most commonly disallowed HRA claim.
Do I need my landlord's PAN?
Once your annual rent crosses ₹1,00,000 you must report the landlord's PAN to your employer. If the landlord has no PAN, you need a signed declaration from them instead. Separately, if you pay more than ₹50,000 a month as an individual, you must deduct 2% TDS under Section 194-IB.
Can I claim both HRA and home-loan interest?
Yes, in genuine cases — for example if you own a house in one city but rent in another for work, or if your own home is genuinely not habitable. Both claims survive scrutiny only when the facts support them; claiming HRA for a flat in the same city where you live in your own house does not.
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