HRA Exemption Calculator

About the HRA calculator

House Rent Allowance (HRA) is a salary component that can reduce taxable income when you receive HRA and pay rent for residential accommodation. This calculator estimates the annual exempt HRA, taxable HRA, and tax saved under Section 10(13A).

It is most useful for salaried employees in India who rent their home, especially when comparing metro and non-metro limits or checking whether Dearness Allowance forms part of salary for HRA purposes. The calculation uses monthly salary, eligible DA, HRA received, rent paid, city type, and your marginal tax bracket.

Treat the result as a planning estimate. Your employer may require rent receipts, a rental agreement, and landlord PAN where applicable before allowing the exemption through payroll.

1. 1Enter monthly basic salary: Use the basic salary from your payslip, since HRA exemption is linked to basic pay and eligible DA rather than total CTC.
2. 2Add eligible Dearness Allowance: Enter DA only if it forms part of salary under your employment terms. If it does not, switch DA eligibility to No so the calculator excludes it from the salary base.
3. 3Enter HRA received and rent paid: Use monthly HRA and monthly rent. The calculator annualizes both figures before applying the statutory limits.
4. 4Select city type: Choose metro for Delhi, Mumbai, Kolkata, or Chennai. Other cities use the non-metro salary limit.
5. 5Choose your tax bracket: Pick your marginal tax rate to estimate tax saved on the exempt HRA amount, including 4% health and education cess.

How is HRA exemption calculated?

HRA exemption = least of (actual HRA received, 50% or 40% of salary, rent paid - 10% of salary)

Taxable HRA is actual HRA received minus exempt HRA. Estimated tax saved is exempt HRA multiplied by your marginal tax rate plus 4% cess.