How to use
Enter your monthly basic salary (plus DA if applicable), the HRA you receive monthly, the rent you actually pay monthly, and select your city type. Metro city applies to Delhi, Mumbai, Kolkata, Chennai, Bangalore, Pune, Hyderabad, and Ahmedabad (the FY 2026-27 metro list) -- all other cities count as non-metro. The calculator shows all three components side by side and highlights which one determines your exemption.
Example
Priya works in Bangalore (a metro city as of FY 2026-27) with a basic salary of ₹50,000/month, receives ₹25,000/month as HRA, and pays ₹20,000/month in rent. Her three amounts are: actual HRA received ₹3,00,000/year, rent minus 10% of basic ₹1,80,000/year, and 50% of basic (metro rate) ₹3,00,000/year. The lowest of these is ₹1,80,000, so that amount is exempt from tax, and the remaining ₹1,20,000 of her HRA is added to her taxable income. This only applies if Priya opts for the Old Tax Regime -- under the New Regime, HRA exemption isn't available at all.
HRA exemption at different rent levels (Basic ₹50,000/month, HRA received ₹25,000/month, metro city)
| Monthly Rent Paid | Rent − 10% of Basic (annual) | HRA Exemption (lowest of 3) |
|---|
| ₹10,000 | ₹60,000 | ₹60,000 |
| ₹15,000 | ₹1,20,000 | ₹1,20,000 |
| ₹20,000 | ₹1,80,000 | ₹1,80,000 |
| ₹30,000 | ₹3,00,000 | ₹3,00,000 |
Frequently asked questions
What cities count as 'metro' for HRA purposes?
As of FY 2026-27, eight cities qualify for the higher 50% metro rate: Delhi, Mumbai, Kolkata, Chennai, Bangalore, Pune, Hyderabad, and Ahmedabad. This was expanded from the original four metros (Delhi, Mumbai, Kolkata, Chennai) -- all other cities use the 40% non-metro rate. If you're using an older calculator or guide, double-check it reflects this updated list.
Can I claim HRA exemption under the New Tax Regime?
No. HRA exemption is only available under the Old Tax Regime. If you've opted for the New Regime, your entire HRA received is taxable, and this exemption doesn't apply -- factor that into your regime comparison using the Income Tax Calculator.
Can I claim HRA if I pay rent to my parents?
Yes, this is legally permitted, provided the arrangement is genuine -- you actually pay the rent (ideally via bank transfer, not cash), and your parents declare that rental income in their own tax return. You'll typically need a rent receipt and, if annual rent exceeds Rs 1 lakh, your parent's PAN.
What if my landlord refuses to share their PAN?
PAN is mandatory if your annual rent exceeds Rs 1,00,000. If your landlord doesn't have a PAN, they can provide a signed declaration to that effect, which you should keep along with your rent receipts. Without either, your employer may refuse to process the HRA exemption, though you can still claim it directly when filing your return.
Can I claim both HRA and home loan interest deduction?
Yes, if the situations are genuinely different -- for example, you live in a rented home in one city while your own home (financed by the loan) is in another city, or is still under construction, or is rented out. Claiming both for the same self-occupied property you're also renting elsewhere without genuine justification can attract scrutiny.
I forgot to submit rent receipts to my employer -- can I still claim HRA?
Yes. If your employer didn't factor in your HRA exemption and deducted more TDS than necessary, you can still claim the exemption directly while filing your income tax return, using the same calculation, and claim a refund of the excess tax deducted.
Does DA (Dearness Allowance) matter for this calculation?
Yes, if your salary structure includes DA that counts toward retirement benefits, it should be added to Basic Salary in this calculation, since the rule technically refers to 'Basic + DA (to the extent it forms part of retirement benefits)'. Most private-sector salaries don't include DA -- if yours doesn't, just use Basic Salary alone.
This calculator provides estimates only and does not constitute financial advice. Actual figures from your lender or institution may vary. Consult a qualified financial advisor before making financial decisions.