Tax planning

HRA Exemption Calculator

Estimate exempt and taxable House Rent Allowance using the three-rule method. The calculator shows monthly figures and annualises them assuming the same inputs apply for all 12 months.

City Type

Metro cities: Delhi, Mumbai, Chennai, Kolkata.

How HRA Exemption Works

  • HRA exemption is the minimum of 3 rules.
  • Rule 1: Actual HRA received from employer.
  • Rule 2: Rent paid − 10% of (Basic + eligible DA).
  • Rule 3: 50% of (Basic + eligible DA) for metro or 40% for non-metro.
  • Only available under the old tax regime.
  • Eligible DA = DA forming part of retirement benefits. Most private employees have zero eligible DA.

Exempt HRA (Monthly)

₹

Exempt (Annual)

₹

Taxable (Annual)

₹

Taxable HRA (Monthly)

₹

How the HRA exemption estimate works

The estimated exemption is the lowest of actual HRA received, rent paid minus 10% of eligible salary, and 50% of eligible salary for Delhi, Mumbai, Chennai or Kolkata or 40% elsewhere. Any HRA received above that minimum is shown as taxable HRA.

Actual allowance

The HRA component received from the employer for the relevant period.

Rent-based limit

Rent actually paid minus 10% of basic salary plus eligible DA.

Location-based limit

50% of eligible salary for the four specified metros; 40% for other locations.

Important limits of this calculator

  • The annual result assumes salary, HRA, rent and city type remain unchanged for 12 months.
  • If any input changes during the year, calculate each relevant period separately.
  • The salary input covers basic salary plus DA that forms part of retirement benefits. Turnover-based commission, where applicable to the legal salary definition, is not captured separately here.
  • HRA exemption generally applies when the eligible old-regime treatment is used. Confirm the Act, tax year and filing rules that apply to you.

Frequently asked questions

Can I claim an exemption if I pay no rent?

No. The rent-based limit becomes zero, so the minimum of the three rules is zero.

Does Bengaluru, Hyderabad or Pune receive the 50% limit?

No. For this calculation, only Delhi, Mumbai, Chennai and Kolkata use 50%; other cities use 40%.

What documents may be needed?

Keep the rent agreement and evidence of rent payments. Current employer reporting rules also require landlord PAN when annual rent exceeds ₹1,00,000.

Continue your salary and housing check

Compare tax regimes, review renting versus buying, or estimate employment gratuity.

Income tax → Rent vs Buy → Gratuity →

This is an educational estimate, not tax-filing advice. Verify current rules and supporting-document requirements before making a claim.