About this tool
The exempt HRA is the lowest of three amounts: HRA received, rent paid minus 10% of salary, and 50% of salary in a metro (40% elsewhere). Salary here means basic plus DA.
Claiming the right amount of HRA
House rent allowance is one of the largest tax breaks available to salaried tenants, but only under the old regime. The exempt part is the smallest of three amounts: the HRA you actually receive, the rent you pay minus 10% of your salary, and 50% of salary if you live in Delhi, Mumbai, Kolkata or Chennai, or 40% anywhere else. Salary here means basic pay plus dearness allowance, not your full gross pay.
An example shows how the limits interact. Suppose your basic is ₹50,000 a month, your HRA is ₹20,000, you pay ₹22,000 in rent and you live outside the four metros. Over a year, HRA received is ₹2.4 lakh, rent minus 10% of salary is ₹2.04 lakh, and 40% of salary is ₹2.4 lakh. The lowest figure, ₹2.04 lakh, is exempt, and the rest of your HRA is taxed. If your rent were higher, the exemption would rise until it reached one of the other two limits.
Keep your paperwork in order. You need rent receipts or a rental agreement, and if your yearly rent is above ₹1 lakh your employer will ask for the landlord's PAN. Paying rent to a parent is allowed if they genuinely own the property and declare the rent as income, but paying rent to a spouse usually raises questions. If you do not receive HRA from your employer, a separate deduction for rent may still be available under the old regime, with its own lower limits. Once you have the exempt amount, enter it in the regime comparison to see whether claiming it makes the old regime the better choice for you this year.
How to use it
- Enter your numbers in the boxes, or drag the sliders.
- Read the result on the right. It updates as you type.
- Open the year-by-year table, if shown, to see how the numbers change over time.
- Use 'Copy link with these values' to save the calculation or send it to someone.
Questions
Which cities count as metro for HRA?
Delhi, Mumbai, Kolkata and Chennai. Bengaluru, Hyderabad and Pune count as non-metro for HRA purposes.
Can I claim HRA in the new regime?
No. HRA exemption is available only under the old regime.
Last reviewed 16 October 2026. Results are estimates for planning. Check important figures with your bank, employer or a qualified adviser.