Money
HRA Exemption
Find how much of your HRA is exempt from tax and how much is taxable, for metro and non-metro cities.
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HRA exempt from tax
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- Taxable HRA-
Annualized calculation. Keep rent receipts and your rental agreement; for annual rent above ₹1 lakh you must report your landlord's PAN.
How to use
1. Enter monthly basic, HRA received, and rent paid. 2. Pick metro or non-metro. 3. Read the exempt and taxable amounts.
Worked example
Basic ₹60,000, HRA ₹30,000, rent ₹25,000 in a metro city: exempt is the minimum of ₹3,60,000, ₹2,28,000, and ₹3,60,000, so ₹2,28,000 is exempt and ₹1,32,000 is taxable.
How the math works
Exempt HRA = minimum of three annual amounts: HRA received, rent paid minus 10% of basic salary, and 50% of basic (metro) or 40% (non-metro). The rest of your HRA is taxable.
Which cities count as metro for HRA?
Delhi, Mumbai, Chennai, and Kolkata get the 50% limit; every other city uses 40%.
What proof do I need for rent paid?
Rent receipts and the rental agreement. For annual rent above ₹1 lakh, report your landlord's PAN to your employer.
Can I claim HRA while living with parents?
Yes, if you genuinely pay them rent and they declare it as income. Keep receipts and a rent agreement.
What if my rent is less than 10% of salary?
Then rent minus 10% of salary is zero or negative, so that leg gives no exemption. The minimum of the three amounts still decides the final figure.