HRA Exemption Calculator — How Much of Your House Rent Allowance Is Tax-Free

The rule

Under section 10(13A) and Rule 2A, the exempt HRA is the least of: the HRA actually received; rent paid less 10% of salary; and 50% of salary if the house is in Mumbai, Delhi, Kolkata or Chennai, otherwise 40%. “Salary” for this purpose is basic pay plus dearness allowance that counts for retirement benefits plus commission at a fixed percentage of turnover. The exemption is available only under the old tax regime and only for the months in which rent was actually paid for accommodation you occupy; it is not available if you live in your own house or pay no rent. Thane and Navi Mumbai are not metros for this rule even though they are part of the Mumbai region. Your employer will ask for rent receipts, the rental agreement, and the landlord’s PAN where rent exceeds ₹1 lakh a year; where rent exceeds ₹50,000 a month you must deduct TDS at 2% under section 393 (194-IB of the 1961 Act) and give the landlord Form 16C. Compare regimes with our old vs new calculator.

Disclaimer. These calculators are provided for general information only. They apply the Indian and UAE tax rules as we understand them for the year stated and are not legal, tax or professional advice, and they do not create a client relationship. Your actual liability depends on your complete facts, on documents we have not seen and on law that changes; please confirm any figure with us before relying on it or acting on it. I. H. Khan and Associates accepts no liability for decisions taken on the basis of these tools. Nothing you enter leaves your browser unless you choose to send the result to us. Section numbers are those of the Income-tax Act, 2025, in force from 1 April 2026, with the familiar 1961 Act number in brackets; the rules are unchanged — see our section map.