HRA Exemption Calculator
House Rent Allowance (HRA) is a common salary component that is partly tax-exempt if you live in rented accommodation — but only under the old tax regime (the new regime does not allow this exemption). The exempt amount is the smallest of three figures. This calculator applies the official rule and shows exactly how much of your HRA is tax-free and how much is taxable.
How to use the hra exemption calculator
- Enter your monthly basic salary (and dearness allowance, if it counts towards retirement benefits) — not your full gross salary.
- Enter the HRA amount you actually receive each month, and the rent you actually pay.
- Choose metro if you live in Delhi, Mumbai, Kolkata or Chennai (50% of basic), or non-metro for any other city (40% of basic).
Formula
HRA exemption = the smallest of: (a) actual HRA received, (b) rent paid − 10% of basic salary, (c) 50% of basic salary (metro) or 40% of basic salary (non-metro). The taxable HRA is HRA received minus the exempt amount.
Worked examples
A Mumbai tenant
Basic ₹50,000/month, HRA ₹20,000/month, rent ₹18,000/month, metro city: (a) ₹20,000, (b) ₹18,000 − ₹5,000 = ₹13,000, (c) 50% of ₹50,000 = ₹25,000. The smallest is ₹13,000, so ₹13,000 is exempt each month and ₹7,000 is taxable.
A non-metro employee not paying much rent
Basic ₹40,000, HRA ₹15,000, rent ₹8,000, non-metro: (b) ₹8,000 − ₹4,000 = ₹4,000, which is the smallest of the three — so only ₹4,000 is exempt and ₹11,000 of the HRA is taxable.
Metro cities for HRA, and HRA vs other old-regime deductions
For HRA exemption purposes, only Delhi, Mumbai, Kolkata and Chennai are classified as metro cities (giving the 50%-of-basic limit) — Bengaluru, Hyderabad, Pune and other large cities are treated as non-metro (40%-of-basic limit) for this specific calculation, even though they're often called "metros" in everyday conversation. Double-check this if you've relocated between cities partway through a financial year, since the applicable percentage can change month to month.
HRA exemption is one of several old-regime deductions, and it's worth comparing against the others before assuming HRA alone makes the old regime worthwhile: Section 80C (up to ₹1.5 lakh — PF, ELSS, life insurance, etc.), Section 80D (health insurance premiums), and home loan interest under Section 24(b) (up to ₹2 lakh for a self-occupied property) are the other big levers. Run the income tax calculator with your total old-regime deductions (HRA exemption plus these others combined) to see the full picture, rather than judging HRA in isolation.
Common mistakes to avoid
- Claiming full HRA as exempt without checking all three conditions — the exemption is always the smallest of the three, not simply the HRA received.
- Trying to claim HRA exemption under the new tax regime — it is only available under the old regime.
- Not keeping rent receipts or a rental agreement — HRA claims above ₹1,00,000 a year require the landlord’s PAN, and claims can be disallowed without proof.
Frequently asked questions
Can I claim HRA exemption if I live in my own house?
No. HRA exemption requires that you actually pay rent for the accommodation you live in. If you own your home and don’t pay rent, the entire HRA received is taxable.
Can I claim HRA and a home loan deduction together?
Yes, in specific cases — for example if you rent a home in the city you work in while your own home (bought with a loan) is in another city, or is still under construction.
Is HRA exemption available under the new tax regime?
No. The new tax regime does not allow the HRA exemption (or most other exemptions and deductions) — use this calculator only when comparing or filing under the old regime.
What if I don’t receive HRA as part of my salary?
Self-employed people or salaried employees who don’t get HRA can claim a similar deduction under Section 80GG instead, subject to its own separate limits.
Reviewed September 29, 2026 by the CalcSolver editorial team. Found a mistake? Tell us; see our editorial policy.