HRA Calculator (FY 2026-27)
Find your exact HRA exemption under Section 10(13A) — the lowest of three legal calculations — plus the tax you’ll save and whether the old regime is still worth it for you.
Enter your salary + rent details
📊 Show full breakup (the 3 legal calculations)
| Calculation | Amount |
|---|---|
| 1. Actual HRA received | — |
| 2. Rent paid minus 10% of (Basic + DA) | — |
| 3. 50% of (Basic + DA) — metro | — |
| HRA exempt = LOWEST of the three | — |
| HRA received | — |
| Taxable HRA = received − exempt | — |
Section 10(13A) exemption is the lowest of these three. Available only under the OLD tax regime.
How HRA exemption actually works
House Rent Allowance (HRA) is a salary component that’s partially exempt from tax under Section 10(13A) — but only if you’re in the old tax regime AND you actually pay rent. The exemption is the lowest of three numbers:
1. Actual HRA received from employer
2. Rent paid minus 10% of (Basic + DA)
3. 50% of (Basic + DA) if metro / 40% if non-metro
Whatever’s left after the exemption gets added back to your taxable income.
The 4 metro cities (the most-confused rule)
Only Delhi, Mumbai, Kolkata and Chennai count as metros. Bengaluru, Pune, Hyderabad, Ahmedabad — all non-metros for HRA purposes, regardless of how expensive they are. The 50% vs 40% distinction is statutory and matches the original 1961 Income Tax Act categorisation.
The ₹1 lakh rent + landlord PAN rule
If your annual rent exceeds ₹1,00,000, you must submit your landlord’s PAN to your employer to claim HRA. Below ₹1L, rent receipts suffice. If you can’t get PAN (e.g., rent paid to parents who don’t have PAN), the HRA can be disallowed — keep alternate proof (bank statements, agreement, declaration).
The math on a real example
Software engineer in Bengaluru (non-metro) — ₹6 lakh basic, ₹2.4 lakh HRA, ₹3 lakh annual rent:
- Actual HRA: ₹2,40,000
- Rent − 10% basic: ₹3,00,000 − ₹60,000 = ₹2,40,000
- 40% of basic (non-metro): ₹2,40,000
- HRA exempt: ₹2,40,000 (all three are equal — the entire HRA is tax-free)
- Tax saved at 30% slab: ₹72,000/year
This is the cleanest case. Most real situations have one of the three numbers significantly lower — and that becomes your binding constraint.
Old regime vs new regime — does HRA save you enough?
Under the new regime, HRA is fully taxable. The old regime survives only if your total deductions — HRA + 80C (₹1.5L) + 80D + home-loan interest — exceed the new regime’s ₹75,000 standard deduction plus its lower slab rates.
Quick rule of thumb: If your HRA exemption alone is ₹2L+ AND you have a working 80C portfolio, the old regime usually wins. If your HRA exemption is below ₹1L, the new regime usually wins. Run both side-by-side every year — the math tips with salary changes.
Want the full salary tax playbook?
Get my Sunday email — one tactical money decision per week. Plus the free Clarity Playbook on how Indian salaried investors actually build wealth.
Get the free book →Frequently asked questions
How is HRA exemption calculated?
HRA exemption under Section 10(13A) is the lowest of three numbers: (1) actual HRA received, (2) rent paid minus 10% of (basic + DA), and (3) 50% of (basic + DA) if metro, 40% if non-metro. The lowest of these three is exempt; the rest is taxable salary income.
Which cities count as metros for HRA?
Only Delhi, Mumbai, Kolkata, Chennai. Bengaluru, Pune, Hyderabad, Ahmedabad are non-metros. The metro definition is statutory under the Income Tax Act — it does not change based on cost-of-living or city size today.
Can I claim HRA if I live with my parents?
Yes — provided you actually pay rent (via bank transfer, not cash), have a rent agreement, and your parents declare the rental income in their ITR. Keep all proofs for 6 years in case of scrutiny. If your parents are in a lower tax slab, this can also be tax-efficient at the family level.
Do I need to submit rent receipts to claim HRA?
Yes. Below ₹1L/year rent — receipts only. Above ₹1L/year — you must submit landlord’s PAN to employer. Without PAN, HRA can be disallowed. Always keep monthly rent receipts and the rental agreement on file.
Is HRA available in the new tax regime?
No. HRA exemption under Section 10(13A) is available only in the OLD regime. New regime treats HRA as fully taxable. Use this calculator’s “tax saved” output to decide if old regime is still better for you.
Can I claim both HRA and home loan deduction?
Yes — if you genuinely live in a rented house and your owned house is in a different city or rented out. You can claim HRA (Sec 10(13A)) for rent + home loan principal (Sec 80C) + interest (Sec 24b) simultaneously. Tax officers scrutinise this combination — keep proof.
What if my employer doesn’t include HRA in salary?
Use Section 80GG instead. Limit: lowest of ₹60,000/year, 25% of total income, or rent paid minus 10% of total income. Significantly lower than HRA. Also unavailable under new regime.
How is HRA computed if I changed cities or rent during the year?
Month-by-month, then summed. The calculator above does annual math — for partial-year cases, split into segments and compute each separately. ITR-filing software (ClearTax, Quicko) handles this from Form 16.