Calculate your exact HRA exemption under Section 10(13A) of the Income Tax Act. See all three tax conditions applied to your salary figures, understand which rule limits your exemption, and know exactly how much HRA is tax-free vs taxable.
Last updated: 2026 · Old Tax Regime only · Metro cities: Mumbai, Delhi, Kolkata, Chennai, Hyderabad, Pune, Ahmedabad, Bengaluru
⚠️ *Annual benefit estimated at 30% tax bracket. Actual saving depends on your slab.
HRA Breakdown
HRA exemption under Section 10(13A) of the Income Tax Act is one of the largest salary-linked tax benefits for salaried employees in the old tax regime.
HRA exemption under Section 10(13A) is calculated using three conditions. The lowest value among them becomes your tax-free HRA.
% of Basic = 50% (Metro cities) or 40% (Non-metro cities)
Example: Basic ₹50,000 · HRA ₹25,000 · Rent ₹22,000 (Metro city)
The city classification significantly impacts your exemption:
Note: From FY 2026–27, Hyderabad, Pune, Ahmedabad, and Bengaluru were added to the metro list. Cities outside this list continue to follow the 40% non-metro rule.
Submit Form 12BB to your employer at the start of the financial year.
You cannot claim HRA exemption if you live in your own house in the same city.
However, you can simultaneously claim:
This is a common scenario for employees working in Mumbai/Delhi who own a home in their hometown. Both benefits can be claimed simultaneously with proper documentation.
HRA exemption is NOT available under the New Tax Regime (default regime from FY 2023–24 onwards).
Under the New Regime:
If your HRA exemption is large (e.g., above ₹1.5–2L/year), the Old Regime with all deductions may result in lower total tax. Use the Income Tax Calculator to compare both regimes.
Example 1 – Mumbai (Metro):
Example 2 – Pune (Metro):
Yes, but it must be a genuine rental arrangement. Requirements: a proper registered or notarised rent agreement, rent paid by bank transfer (not cash), and your parents must declare the rental income in their ITR. It does not work if your parents do not own the property, or if you own the property jointly. The Income Tax department scrutinises such claims — maintain all documentation.
If Rent Paid − 10% of Basic is zero or negative, Condition 3 = ₹0. Since exemption = minimum of all three conditions, the result is ₹0 exemption. Your entire HRA received becomes fully taxable. Example: Basic ₹50,000 → 10% = ₹5,000. If rent paid is ₹4,000, Condition 3 = −₹1,000 → treated as zero. To get any HRA benefit, your rent must exceed 10% of Basic Salary.
No. HRA exemption under Section 10(13A) is only available under the Old Tax Regime. Under the New Tax Regime (default from FY 2023–24), HRA exemption is not permitted. Other deductions like 80C, 80D, LTA, and home loan interest are also unavailable. If your HRA + other deductions exceed ₹3–4L per year, the Old Regime may result in lower tax. Compare both regimes using the Income Tax Calculator.
Yes. HRA exemption is calculated on a month-by-month basis. If you worked in Mumbai (metro) for 6 months and Jaipur (non-metro) for 6 months, each period is calculated separately with its applicable rate (50% vs 40%). Keep rent receipts and agreements for each city and period. Report both periods correctly when filing your ITR.
If your salary structure does not include an HRA component, you cannot claim HRA exemption under Section 10(13A). However, you can claim a deduction for rent paid under Section 80GG (if you are not receiving HRA and do not own a home at the place of work). Section 80GG deduction is the minimum of: actual rent paid − 10% of adjusted total income, 25% of adjusted total income, or ₹5,000 per month (< ₹60,000/year). This is significantly less generous than HRA exemption.
Yes — if the rented accommodation and the owned property are in different cities. Example: You work in Mumbai (claim HRA for rented flat) and own a home in Pune (claim Section 24b home loan interest deduction up to ₹2L). Both can be claimed simultaneously. If both are in the same city, tax officers may question whether the home loan property could have been used for self-occupation, but it is not automatically disallowed.