What is House Rent Allowance (HRA)?

House Rent Allowance (HRA) is a component of a salary package provided by an employer to an employee to meet the cost of living in a rented accommodation. A portion of this allowance is exempt from tax under Section 10(13A) of the Income Tax Act.

Is Dearness Allowance (DA) included for HRA calculation?

Yes, but only the portion of Dearness Allowance that is considered for retirement benefits is included in the 'salary' for HRA calculation purposes, along with the Basic Salary. If your payslip doesn't specify this, you can enter 0 for DA.

HRA Exemption Calculator (India)

All amounts should be entered on a monthly basis. Currency is fixed to INR (₹).

Your Salary Details (Monthly)

Basic Salary

₹

Dearness Allowance (DA)

₹

Rent & HRA Details (Monthly)

HRA Received from Employer

₹

Actual Rent Paid

₹

City of Residence

Your HRA Exemption Details (Yearly)

HRA Exemption Amount

Taxable HRA Amount

Calculation Breakdown (Yearly Figures)

Your exemption is the lowest of the following three values:

1. Actual HRA Received:

2. Rent Paid - 10% of Salary:

3. 40%/50% of Salary:

Understanding Your Payslip

House Rent Allowance (HRA) is a common component of your salary, given by your employer to cover your rental accommodation costs. While it's part of your income, the Indian Income Tax Act allows you to claim a tax exemption on a portion of it under Section 10(13A), which can significantly reduce your tax liability.

The exempt amount depends on your salary, the HRA you receive, the rent you pay, and where you live. This calculator helps you determine the exact exempt and taxable portions of your HRA for the financial year, so you can plan your taxes more effectively. *This is an estimate for planning purposes and is not tax advice.*

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Frequently Asked Questions (FAQ)

How is HRA exemption calculated?

The amount of HRA that is exempt from tax is the minimum of the following three amounts:

The actual HRA received from your employer.
The actual rent you pay minus 10% of your 'salary' (Basic + DA).
50% of your 'salary' if you live in a metro city (Delhi, Mumbai, Kolkata, Chennai), or 40% for any other city.

Can I claim HRA exemption if I live with my parents?

Yes, you can claim HRA exemption even if you live with your parents, but you must have a formal rental agreement with them and transfer the rent amount to their bank account. Your parents must then report this rental income in their own tax returns.

Is providing the landlord's PAN mandatory?

Yes, if your annual rent exceeds ₹1,00,000 (or ₹8,333 per month), you are required to provide your landlord's PAN to your employer to claim the full HRA exemption. If the landlord does not have a PAN, a declaration to this effect is required.