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HRA Exemption Calculator India

Calculate your likely HRA exemption under Rule 279 in seconds. Enter your salary, HRA, rent, and city type to compare the three legal limits and estimate how much HRA can stay tax-exempt under the old regime. Includes FY 2026-27 metro-city rules, a worked example, and a document checklist.

Last updated: May 2026
Reviewed for FY 2026-27 HRA city-rule changes.

Educational estimate only

Results can vary based on company policy, lender terms, tax law, and personal assumptions.

For HRA claims, verify final eligibility and documentation with your employer payroll team, CA, and official rules before filing.

See the Source and methodology section below for details.

Enter your values

Estimated results

Monthly HRA Exemption

₹20,000

Annual HRA Exemption

₹2,40,000

Taxable HRA Monthly

₹0

Taxable HRA Annual

₹0

Based on your inputs:

  • Actual HRA received: ₹20,000
  • Salary cap used: 50%
  • Rent minus 10% of salary: ₹20,000
  • Estimated exempt HRA: ₹20,000

Important FY 2026-27 update

Important FY 2026-27 update: Under Rule 279 of the Income-tax Rules, 2026, Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru follow the 50% salary cap for HRA exemption. All other cities use the 40% cap. Where the applicable employer declaration or prescribed form asks for landlord details, keep the landlord name, address, PAN/Aadhaar where applicable, rent paid and relationship with the landlord ready.

This result is an estimate for educational use. RupeeKit does not provide tax, legal or filing advice. Your final exemption may depend on salary structure, employer policy, proof submission and applicable tax rules.

Visual Breakdown

Exempt monthly HRA is ₹20,000 and taxable monthly HRA is ₹0.

HRA Split₹20,000
Exempt HRA
₹20,000(100.0%)
Taxable HRA
₹0(0.0%)

What-If Scenarios

See how a 10% change in your primary input affects the final outcome.

-10% Scenario

Monthly Basic Salary

₹45,000

Annual HRA Exemption

₹2,40,000

Current Baseline

Monthly Basic Salary

₹50,000

Annual HRA Exemption

₹2,40,000

+10% Scenario

Monthly Basic Salary

₹55,000

Annual HRA Exemption

₹2,34,000

💡 Educational Estimates Only

This visual breakdown and compounding model is for educational understanding only. Actual outcomes can vary depending on interest accrual dates, taxation brackets, processing fees, and individual employer/lender terms.

HRA Exemption Quick Answer

Quick Answer

How is HRA exemption calculated in India? HRA exemption under the old tax regime is generally calculated as the lowest of three values: actual HRA received, rent paid minus 10% of salary, or 50% of salary for specified cities and 40% of salary for other cities. HRA benefit is generally not available under the new tax regime.

Formula

HRA exemption = minimum of actual HRA, rent paid - 10% of salary, and 50% or 40% of salary based on city category

Example

If salary is Rs 6,00,000, HRA received is Rs 2,40,000, and annual rent is Rs 3,00,000 in Bengaluru, compare actual HRA, rent minus 10% salary, and 50% salary cap.

Educational estimate only. Verify HRA rules, documents, and employer payroll treatment with official sources, employer, or CA.

Answer Engine Summary

This calculator estimates Monthly HRA Exemption, Annual HRA Exemption, Taxable HRA Monthly, and Taxable HRA Annual using Basic Salary, Dearness Allowance, Commission, and HRA Received. Rule 279 HRA exemption is calculated as the lowest of: (1) actual HRA received, (2) rent paid minus 10% of salary, and (3) a salary cap based on city group. Results are educational estimates only and should be verified with official records, lender statements, payroll data, or filing utilities where applicable.

Tax Filing Resource

ITR-2 AY 2026-27: Who Must File, Due Date and Preparation Guide

Use this guide to verify ITR-2 applicability, required documents, and filing steps.

Read ITR-2 Guide

How is HRA exemption calculated?

Use this HRA exemption calculator to calculate HRA exemption by comparing three legal limits under Rule 279. Enter salary components, actual HRA received, rent paid, and city cap. The lowest value is the likely exempt amount under old tax regime HRA exemption.

  • Actual HRA received.
  • Rent paid minus 10% of salary.
  • City-based cap: 50% or 40% of salary.

Use the calculator above to calculate HRA exemption instantly using your salary, HRA received, rent paid and city type.

HRA Exemption Formula under Rule 279

The HRA calculation formula is the least of these values: actual HRA received, rent paid minus 10% of salary, and the city salary cap. This HRA tax exemption calculator follows that structure so your HRA exemption calculation and HRA deduction calculation remain easy to understand.

Trust note: this tool gives an estimate only. If your salary structure, landlord relationship, or declaration process is complex, verify with your employer payroll team or CA before filing.

Formula Part 1

Actual HRA received

Formula Part 2

Rent paid minus 10% of salary

Formula Part 3

50% or 40% city salary cap

Which cities use the 50% HRA salary cap?

Rule 279 HRA exemption uses two city groups for salary cap.

City categorySalary capExample citiesNote
Specified city list50% of salaryMumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad, BengaluruUse this cap when your city is in the Rule 279 specified list.
Other Indian cities40% of salaryCities not listed in the specified 50% groupUse this cap for non-specified city category cases.

Can HRA be claimed in the new tax regime?

HRA exemption is relevant under the old tax regime. In the default new tax regime, HRA exemption is generally not available, so this calculator is best used for old regime tax planning and comparison.

HRA Calculation Example

A) Metro/50% city example: Bengaluru

Annual basic salary + DA is Rs 6,00,000. Annual HRA received is Rs 2,40,000 and annual rent paid is Rs 3,00,000. Actual HRA received is Rs 2,40,000. 50% of salary is Rs 3,00,000. Rent paid minus 10% of salary is Rs 2,40,000. The least value is Rs 2,40,000, so exempt HRA is Rs 2,40,000.

B) Other city/40% example: Indore

Annual basic salary + DA is Rs 6,00,000. Annual HRA received is Rs 2,40,000 and annual rent paid is Rs 3,00,000. Actual HRA received is Rs 2,40,000. 40% of salary is Rs 2,40,000. Rent paid minus 10% of salary is Rs 2,40,000. The least value is Rs 2,40,000, so exempt HRA is Rs 2,40,000.

What documents are required for HRA exemption?

  • Rent receipts.
  • Rent agreement, if available.
  • Landlord PAN where applicable.
  • Employer HRA declaration.
  • Salary slip showing basic salary, DA if applicable, and HRA.
  • Bank transfer proof if rent is paid digitally.
  • Landlord relationship disclosure where required.

What if You Missed HRA Proof Submission?

If proof was missed during payroll declaration, employer TDS may be higher. In many cases, you can still claim eligible HRA exemption while filing your return, subject to records and current filing rules.

Can you pay rent to parents and claim HRA?

Yes, if rent is genuinely paid and documented. Keep receipts and payment trail, and ensure rental income is disclosed by parents where required.

Landlord Details and Relationship Disclosure

Where Form 12BB, Form 124, or any applicable employer declaration asks for landlord details, keep the landlord name, address, PAN/Aadhaar where applicable, rent paid and relationship with the landlord ready.

Common HRA Claim Mistakes

  • Using the wrong city cap for HRA exemption calculation.
  • Assuming full HRA is exempt without applying the least-of-three rule.
  • Using non-eligible salary components in the HRA calculation formula.
  • Submitting incomplete rent records or missing landlord PAN where needed.
  • Missing landlord detail disclosure where requested in employer declaration.

When This Calculator Is Useful

  • Before choosing between old and new regime during payroll planning.
  • When you want a quick HRA exemption calculation estimate.
  • When reviewing if full HRA received can actually stay tax-exempt.

Related reads and calculators

For full planning, compare with your salary in-hand calculator, Old vs New Tax Regime Calculator, 80C deduction calculator, EMI calculator, ITR-2 filing guide, emergency fund guide.

Source and methodology

This calculator compares actual HRA, rent paid minus 10% of salary, and city-based salary cap. It is designed for educational estimation under old-regime HRA rules and should be verified with employer payroll, official guidance, or a qualified tax professional.

This calculator uses the HRA exemption formula under Rule 279 of the Income-tax Rules, 2026. The estimated exemption is calculated as the least of:

  1. Actual HRA received
  2. Rent paid minus 10% of salary
  3. 50% of salary for specified cities or 40% of salary for other cities

For FY 2026-27, the specified 50% cities include Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru. Please verify your final claim with your employer, payroll team or tax professional before filing.

Official source: Income-tax Rules, 2026 notification, Ministry of Finance / CBDT.

Calculator Facts

TopicRupeeKit explanation
Calculation typeFormula-based educational estimate from user-entered values
Key inputsBasic Salary, Dearness Allowance, Commission, and HRA Received
Primary outputsMonthly HRA Exemption, Annual HRA Exemption, Taxable HRA Monthly, and Taxable HRA Annual
Method referenceRule 279 HRA exemption is calculated as the lowest of: (1) actual HRA received, (2) rent paid minus 10% of salary, and (3) a salary cap based on city group.
Advice boundaryRupeeKit provides educational information only and does not provide personalized financial, tax, legal, investment, or loan advice.

FAQs

Is HRA exemption available in the new tax regime?

HRA exemption is generally relevant under the old tax regime. Under the default new tax regime, this exemption is not typically available.

Which cities use the 50% salary cap for HRA from FY 2026-27?

For FY 2026-27 under Rule 279, the 50% cap applies to Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru.

Is Bengaluru considered a 50% HRA city under the 2026 rules?

Yes. Bengaluru is treated as a 50% salary-cap city for HRA exemption under the FY 2026-27 Rule 279 city grouping.

How is HRA exemption calculated?

The HRA exemption calculation takes the lowest of three values: actual HRA received, rent paid minus 10% of salary, and the city-based cap (50% or 40% of salary).

What is rent paid minus 10% of salary?

This is one of the three Rule 279 HRA exemption limits. You subtract 10% of salary from the rent paid for the period. If the number is negative, that part is treated as zero for practical estimates.

Can I claim HRA if I pay rent to my parents?

Yes, if the arrangement is genuine, rent is actually paid, and records are maintained. Your parents should report rental income where applicable.

What happens if I forgot to submit rent receipts to my employer?

Your employer may deduct higher TDS initially. You may still be able to claim eligible HRA exemption while filing your return, subject to records and tax rules.

Do I need my landlord's PAN to claim HRA?

If annual rent crosses the applicable threshold (commonly ₹1,00,000), employers usually ask for landlord PAN details. Keep PAN and rent records ready.

Is this HRA calculator a tax filing tool?

No. This is an HRA tax exemption calculator for educational estimation. It helps you estimate likely exemption, not file returns.

Why is my full HRA not exempt?

Because Rule 279 HRA exemption uses the least-of-three rule. If rent paid minus 10% of salary or the 50%/40% salary cap is lower than actual HRA received, the balance becomes taxable.