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HRA Calculator — Calculations & Slabs for FY 2026-27

Enter your basic salary, HRA received, and actual rent paid to compute the exact HRA exemption under the least-of-three formula used by Indian income tax rules.

1. Income & Rent Variables

How HRA Tax Exemption is Determined

House Rent Allowance (HRA) is paid by employers to salaried employees to meet rental expenses. Under Section 10(13A) of the Income Tax Act, a portion of this allowance is exempt from tax, helping reduce your total taxable income.

The Three Pillars of HRA Exemption

Your HRA exemption is calculated as the minimum of the following three values:

  • Actual HRA Received: The total HRA portion your employer pays you in the financial year.
  • Rent Paid in Excess of 10% of Basic Pay: The total rent you paid in the year minus 10% of your Basic salary (+ DA). If your rent is less than or equal to 10% of your Basic salary, this limit is ₹0, meaning you will get no tax exemption.
  • City Cap (50% or 40%): If you rent a residential flat in a designated Metro city (Mumbai, Delhi, Kolkata, Chennai), the cap is 50% of your Basic pay. For any other city, the cap is 40% of your Basic pay.

Frequently Asked Questions (FAQ)

What are the three criteria used to calculate tax-exempt HRA in India?

Your HRA exemption is the minimum of these three amounts: (1) The actual HRA received from your employer, (2) The total rent you paid minus 10% of your basic salary (+ DA), or (3) 50% of your basic salary if you live in a metro city (40% if you live in a non-metro city).

Which cities qualify as Metro cities for the 50% HRA calculation?

Only Delhi, Mumbai, Kolkata, and Chennai qualify for the 50% cap. Even if you live in a large metropolitan hub like Bengaluru, Hyderabad, Pune, or Gurgaon, your HRA calculation will fall under the 40% non-metro salary cap rule. This ensures full compliance with the latest regulations, allowing you to estimate values correctly and avoid common filing errors.

Can I claim HRA exemption if I live in my own house?

No, you cannot claim HRA exemption if you live in your own home or do not pay any rent. To qualify for tax deductions, you must be renting a residential space and actually paying rent to the landlord. This ensures full compliance with the latest regulations, allowing you to estimate values correctly and avoid common filing errors.

Is a rent receipt or PAN card of the landlord mandatory to claim HRA?

Yes, you must submit rent receipts to your employer. Additionally, if your total rent paid in a financial year exceeds ₹1 Lakh, you are legally required to provide the PAN details of your landlord to claim the tax exemption. This ensures full compliance with the latest regulations, allowing you to estimate values correctly and avoid common filing errors.

Can I claim both HRA exemption and home loan tax benefits simultaneously?

Yes, you can claim both. For example, if you rent a flat near your office (claiming HRA) but own a house in another city or have let out your owned property, you can claim both HRA and tax deductions on your home loan interest (Section 24) and principal (Section 80C).

Rates sourced from official government portals — see data sources & verification dates

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About This Calculator

Target Audience: Salaried taxpayers, investors & retirees planning Indian tax & wealth growth Last verified: 2026-06-30

What Does This Calculator Do?

This tool calculates how much of your house rent allowance is tax-free. HRA is the money your company pays to help you rent a home. By finding the tax-free part, you can lower your taxable income and save a lot of money on taxes every year. It makes tax planning simple and stress-free.

How to Use It

  1. Monthly Basic Salary + DA: Type your basic pay plus cost-of-living allowance from your pay slip.
  2. Monthly HRA Received: Type the actual rent allowance amount your employer pays you each month.
  3. Monthly Rent Paid: Type the actual rent you pay to your landlord every month.
  4. Living in a Metro City: Select yes if you live in Mumbai, Delhi, Kolkata, or Chennai.

The Logic Explained Simply

  • The Concept: The tax department lets you claim tax relief on rent, but they do not just accept any number. They look at three different numbers: the actual HRA you get, the rent you pay minus a part of your salary, or a fixed portion of your salary. They pick the lowest of these three numbers to be tax-free.
  • The Formula:

Tax-Free HRA is the lowest of:

  1. Actual HRA received
  2. Rent paid - (10% of Basic Salary + DA)
  3. 50% of Salary (metro) or 40% of Salary (non-metro)

Real-World Calculation Breakdown

For example, if your basic salary is ₹50,000, your monthly HRA is ₹20,000, and you pay a monthly rent of ₹15,000 in a metro city like Delhi. The calculator compares: 1) HRA of ₹20,000, 2) Rent minus 10% salary which is ₹10,000, and 3) 50% salary which is ₹25,000. The lowest number is ₹10,000, so ₹10,000 is tax-free, and you only pay tax on the remaining HRA.

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