HRA Exemption Calculator
The three-way minimum that determines your exempt HRA — and why it's zero under the new regime.
This is a calculator, not tax advice. It estimates outcomes based on publicly available rules and typical provider pricing — it does not account for your specific circumstances. Rules and rates change. Verify anything you rely on with a qualified CA before you act on it.
Exempt HRA: ₹2,04,000/year
Limited by: Rent paid minus 10% of salary — the smallest of the three conditions always wins.
The three conditions
- Actual HRA received
- ₹2,40,000
- Rent paid − 10% of salary
- ₹2,04,000
- 50% of Basic + DA
- ₹3,00,000
- Taxable HRA (the rest)
- ₹36,000
How this is calculated
Under Section 10(13A), read with Rule 2A, your exempt HRA is the smallest of three figures: the actual HRA you receive, your rent paid minus 10% of your Basic + DA, and 50% of Basic + DA if you live in a metro (Delhi, Mumbai, Kolkata, Chennai) or 40% elsewhere. Whichever of the three is lowest is what you actually get to exempt — the other two are irrelevant once one is binding.
This only applies under the old tax regime. The new regime doesn't offer an HRA exemption at all — your full HRA is taxable as ordinary salary income there, regardless of rent paid.
Frequently asked questions
Why is my exempt HRA lower than what I actually receive?
Because the exemption is the SMALLEST of three separate figures — actual HRA received, rent paid minus 10% of your salary, and 50% (metro) or 40% (non-metro) of your salary — not just whichever one you'd prefer. Whichever of the three is lowest caps your exemption, and this tool shows you exactly which one is binding.
I don't pay rent — do I still get an HRA exemption?
No. If you pay no rent (or rent below 10% of your salary), the 'rent minus 10% of salary' condition works out to zero or negative, which becomes the binding minimum — so your exemption is zero and the full HRA you receive is taxable.
Does it matter which city I live in?
Yes, for the third condition: Delhi, Mumbai, Kolkata, and Chennai count as metros (50% of salary), everywhere else uses 40%. This is about where you actually live and pay rent, not where your employer is headquartered.
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