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How much of your HRA is actually tax-exempt?

Enter your basic, HRA and rent. The calculator runs the Section 10(13A) least-of-three formula and shows exactly how much of your HRA is exempt under FY 2026-27 rules.

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✓ Free tool ✓ No data stored ✓ Section 10(13A) + Rule 2A
HRA Exemption
Mumbai · Old Regime
FY 2026-27
(a) Actual HRA received ₹25,000
(b) Rent − 10% of Basic ₹25,000
(c) 50% of Basic (metro) ₹25,000
Exempt HRA / month ₹25,000
Annual exemption ₹3,00,000

HOW IT WORKS

The Section 10(13A) least-of-three formula

a

Actual HRA received

The HRA line on your monthly payslip. This is the ceiling, you cannot exempt more HRA than you received.

b

Rent − 10% of Basic

Actual rent paid minus 10% of (Basic + DA). The exemption only kicks in once your rent crosses 10% of your salary base.

c

50% / 40% of Basic

50% of (Basic + DA) for metro cities, 40% for non-metro. The statutory ceiling regardless of how much rent you pay.

Calculate your HRA exemption

Enter your monthly numbers. The result updates instantly with a line-by-line view of the three formula components.

₹
Basic salary plus dearness allowance (the part forming retirement benefits)
₹
The HRA line on your payslip
₹
Actual rent you pay your landlord each month
Metro: Mumbai, Delhi, Kolkata, Chennai (and from FY 2026-27, also Bengaluru, Pune, Hyderabad, Ahmedabad under the Income-tax Rules 2026). Every other city is non-metro.
HRA exemption is only allowed under the old regime. The new regime (Section 115BAC) disallows it.

HRA Exemption, Least of Three (Monthly)

Under Section 10(13A) read with Rule 2A, the exempt HRA is the lowest of these three quantities, computed each month.

(a) Actual HRA received₹25,000LOWEST
(b) Rent paid − 10% of (Basic + DA)₹25,000
(c) 50% of (Basic + DA), metro₹25,000
Monthly Result
Exempt HRA₹25,000
Taxable HRA₹0
Annual Result
Annual HRA Exemption₹3,00,000
Annual Taxable HRA₹0
Landlord PAN required
Annual rent of ₹3,60,000 exceeds ₹1,00,000. CBDT Circular 8/2013 requires you to submit your landlord’s PAN to your employer. If the landlord has no PAN, a signed self-declaration with their name and address is accepted.

Which cities are “metro” for HRA?

The metro classification under Rule 2A controls whether your cap is 50% or 40% of Basic + DA. The list expanded under the Income-tax Rules 2026.

METRO · 50% CAP

The original four (Rule 2A, since 1962)

  • Mumbai (formerly Bombay)
  • Delhi
  • Kolkata (formerly Calcutta)
  • Chennai (formerly Madras)
METRO · 50% CAP · FY 2026-27

Added by Income-tax Rules 2026

  • Bengaluru
  • Pune
  • Hyderabad
  • Ahmedabad
NON-METRO · 40% CAP

Every other city in India

Gurugram, Noida, Jaipur, Chandigarh, Kochi, Coimbatore, Lucknow, Indore, Bhubaneswar, and every other city, all use the 40% cap regardless of cost of living.

Key rules to know before claiming

Old regime only

HRA exemption is disallowed under the new tax regime (Section 115BAC). If you opted for or defaulted to the new regime, the entire HRA you receive is taxable.

Landlord PAN above ₹1 lakh rent

CBDT Circular 8/2013: if your annual rent exceeds ₹1,00,000 you must submit your landlord’s PAN to your employer (or a signed declaration if they have no PAN).

Rent must actually be paid

No exemption if you live in your own home, in employer-provided rent-free accommodation, or in a paper-only arrangement. Rent receipts and a rental agreement are standard proof.

No HRA? Try Section 80GG

If HRA is not part of your salary but you do pay rent, claim Section 80GG instead, capped at ₹60,000 a year, old regime only, and you must not own a home in your work city.

Related reading

Glossary

House Rent Allowance (HRA)

How HRA fits into Indian salary structures, payslip treatment, proof requirements, common employer mistakes.

Glossary

Section 10(13A) explained

The full statutory provision, Rule 2A formula, paying rent to parents, claiming HRA alongside a home loan.

Blog

Indian salary structures & CTC

How to structure HRA, basic and special allowance to maximise take-home pay without inflating employer cost.

Omnivoo

Contract management

Issue offer letters that capture HRA, city tier and rent declarations so payroll picks the right Section 10(13A) exemption.

Common questions

How is HRA exemption calculated under Section 10(13A)? +
HRA exemption is the lowest of three amounts, computed every month: (a) actual HRA received, (b) rent paid minus 10% of (Basic + DA), and (c) 50% of (Basic + DA) for metro cities or 40% for non-metro cities. Anything above the exempt amount is added to taxable salary and subject to TDS.
Which cities count as metro for HRA exemption? +
Mumbai, Delhi, Kolkata and Chennai have always been the four metros under Rule 2A with the 50% cap. Under the Income-tax Rules 2026 (effective 1 April 2026 / FY 2026-27), Bengaluru, Pune, Hyderabad and Ahmedabad have been added, taking the metro list to eight cities. Every other Indian city is non-metro with the 40% cap.
Is HRA exemption available under the new tax regime? +
No. HRA exemption under Section 10(13A) is only allowed under the old tax regime. The new regime (Section 115BAC), which is the default from FY 2023-24, disallows HRA, Section 80C, LTA and most other exemptions in exchange for lower slab rates and a ₹75,000 standard deduction.
When do I need to submit my landlord's PAN? +
When your annual rent exceeds ₹1,00,000. CBDT Circular 8/2013 requires you to submit the landlord's PAN to your employer in that case. If the landlord genuinely does not have a PAN, a signed declaration from the landlord stating so, along with their name and address, is accepted.
Can I claim HRA if I pay rent to my parents? +
Yes, but the arrangement must be genuine. Rent must actually be paid (typically by bank transfer), the parent must declare the rent as 'income from house property' in their own ITR, a written rental agreement and monthly receipts must exist, and the parent's PAN must be provided if annual rent exceeds ₹1 lakh. Notional or paper-only arrangements are routinely disallowed during scrutiny.
What if HRA is not part of my salary? +
If you don't receive HRA as part of your salary but you do pay rent, you can claim a deduction under Section 80GG instead. The maximum is ₹60,000 per year, and the deduction is the least of: ₹5,000 per month, 25% of total income, or rent paid minus 10% of total income. Section 80GG is also old-regime only, and you must not own a home in the city where you work.
Can I claim both HRA and home loan interest deduction? +
Yes, in specific situations. If you own a home in one city but live and pay rent in another (for example, owning a flat in Pune while working and renting in Bengaluru), you can claim HRA on the rented home under Section 10(13A) and home-loan interest under Section 24(b) on the owned property simultaneously. Both claims must be supported by genuine facts.

Run payroll that gets HRA right, every month

Omnivoo applies the correct metro cap, blocks new-regime HRA claims, and flags missing landlord PANs, before they become a year-end TDS recovery.

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