HRA Calculator for Metro/Non-Metro

Calculate your House Rent Allowance (HRA) tax exemption for Metro and Non-Metro cities under the old tax regime. Find out exactly how much HRA is tax-free and how much is taxable.

50%Metro City HRA
40%Non-Metro HRA
4 MetrosDelhi, Mumbai, Kolkata, Chennai
Sec 10(13A)HRA Exemption Rule

HRA Tax Exemption Calculator

Enter your salary and rent details to get your HRA exemption instantly

Basic Salary (₹ / Month)

As per your salary slip — excluding DA if separate
Dearness Allowance – DA (₹ / Month)

Usually 0 for private sector employees
HRA Received from Employer (₹ / Month)

As per salary slip / CTC breakup
Actual Rent Paid (₹ / Month)

Your monthly rent as per rent agreement
City of Residence

🏙️ Metro City
Delhi, Mumbai, Kolkata, Chennai — 50%


🏡 Non-Metro City
All other cities — 40%

Bengaluru, Hyderabad, Pune, Ahmedabad are currently Non-Metro for HRA tax purposes (50% proposed — see below)
Calculation Basis


Monthly figures



Annual figures

Select whether the amounts you entered above are monthly or annual

🧮 Calculate HRA Exemption

📊 HRA Exemption Breakdown

Rule A
—
Actual HRA Received
Rule B
—
50% / 40% of Basic+DA
Rule C
—
Rent Paid − 10% of Basic+DA

✅ Highlighted box = Minimum (Exempt Amount)

Annual Basic Salary—
Annual Dearness Allowance (DA)—
Annual HRA Received—
Annual Rent Paid—
City Type—
Rule A – Actual HRA Received—
Rule B – 50% of (Basic+DA)—
Rule C – Rent Paid minus 10% of (Basic+DA)—
✅ HRA Exempt from Tax (Annual)
—
❌ Taxable HRA (Annual)
—

HRA Exemption Rules & City Guide

Everything you need to know about HRA tax exemption under Section 10(13A) for FY 2025–26

🔔
2026 Proposed Update: The Government has proposed expanding the 50% HRA exemption to Bengaluru, Hyderabad, Pune, and Ahmedabad — in addition to the existing 4 metros (Delhi, Mumbai, Kolkata, Chennai). If passed, employees in these cities can claim 50% (up from 40%) as Rule B. Use 40% until officially notified. Check Income Tax Portal for updates.

🧮The 3-Rule HRA Exemption Formula

HRA exemption = Minimum of the following three amounts (Section 10(13A) of the Income Tax Act, 1961):

Annual Calculation

AActual HRA Received from employer during the year
B50% of (Basic + DA) — if residing in Metro City (Delhi, Mumbai, Kolkata, Chennai)
40% of (Basic + DA) — if residing in Non-Metro city
CActual Rent Paid − 10% of (Basic + DA)
If rent paid ≤ 10% of Basic+DA, this value is Zero (₹0)
Key Rule: If rent paid is less than or equal to 10% of Basic+DA, then Rule C = ₹0, making the entire HRA fully taxable (no exemption). Always ensure rent is meaningfully above 10% of Basic+DA to claim exemption.

🏙️Metro vs Non-Metro Cities for HRA

Only 4 cities are officially classified as “Metro” for HRA tax exemption purposes under the Income Tax Act:

🏛 Delhi — Metro (50%)
🌊 Mumbai — Metro (50%)
🐟 Kolkata — Metro (50%)
🌞 Chennai — Metro (50%)
🔶 Bengaluru — Proposed 50%
🔶 Hyderabad — Proposed 50%
🔶 Pune — Proposed 50%
🔶 Ahmedabad — Proposed 50%
Noida — Non-Metro (40%)
Gurgaon — Non-Metro (40%)
Navi Mumbai — Non-Metro (40%)
Thane — Non-Metro (40%)
Jaipur — Non-Metro (40%)
All other cities — Non-Metro (40%)
Important: Despite being large cities, Bengaluru, Hyderabad, Pune, Navi Mumbai, Noida, and Gurgaon are currently treated as Non-Metro (40%) for HRA tax exemption. The proposed expansion to 50% has not yet been officially notified for FY 2025–26.

📊HRA Exemption Comparison: Metro vs Non-Metro

* Rule B only. Final exempt amount = minimum of Rule A, B, and C. Actual exemption may be lower.

📝Step-by-Step HRA Calculation Example

Given

Employee Details

Basic: ₹60,000/mo
DA: ₹0
HRA Received: ₹24,000/mo
Rent Paid: ₹20,000/mo
City: Mumbai (Metro)

Annual

Annualised Figures

Basic+DA: ₹7,20,000/yr
HRA Received: ₹2,88,000/yr
Rent Paid: ₹2,40,000/yr
10% of Basic+DA: ₹72,000

A

Rule A: Actual HRA Received = ₹2,88,000

B

Rule B (Metro 50%): 50% × ₹7,20,000 = ₹3,60,000

C

Rule C: Rent − 10% of Basic+DA = ₹2,40,000 − ₹72,000 = ₹1,68,000

✅

HRA Exempt = Minimum (A, B, C) = Minimum (₹2,88,000, ₹3,60,000, ₹1,68,000) = ₹1,68,000/year

❌

Taxable HRA = ₹2,88,000 − ₹1,68,000 = ₹1,20,000/year (added to income and taxed as per slab)

💡HRA Tax-Saving Tips for 2026

Tip 1

Pay Rent to Parents

You can pay rent to your parents and claim HRA exemption. Ensure a proper rent agreement and bank transfer. Parents must declare it as rental income.

Tip 2

Rent Receipt Requirement

If annual HRA exceeds ₹1,00,000 (₹8,333/month), you must provide the landlord’s PAN Card to your employer. Rent receipts required for all claims.

Tip 3

Both HRA + Home Loan?

You can claim both HRA exemption (for the rented city) and Home Loan deductions u/s 24(b) if your house is in a different city from where you work and rent.

Tip 4

New Tax Regime Alert

HRA exemption is only available under the Old Tax Regime. If you opt for the New Tax Regime (lower slabs), HRA is fully taxable with no exemption.

Tip 5

Sec 80GG for Non-HRA

If HRA is not part of your salary (self-employed/freelancers), you can claim rent deduction under Section 80GG — up to ₹60,000 per year.

Tip 6

Mid-Year City Change

If you shifted cities mid-year, calculate HRA separately for each period (Metro months at 50%, Non-Metro months at 40%) and sum the totals.

📄Section 80GG vs Section 10(13A) – HRA Comparison

📘 How to Use the HRA Exemption Calculator

Start by entering Basic Salary, DA if it forms part of retirement benefits for HRA purposes, HRA received from the employer and actual rent paid. Then choose Metro or Non-Metro and select whether the figures entered are monthly or annual.

The calculator annualizes monthly inputs automatically and applies the three-rule test shown on the page. The exempt amount is the lowest of actual HRA received, the city-based percentage of Basic + DA, and rent paid minus 10% of Basic + DA.

The highlighted rule block shows which condition is limiting your exemption. This is useful because two employees with the same HRA can receive different exemptions if their rent or city classification differs.

For a broader salary view, use the Salary Breakup Calculator. For current Government HRA calculations outside tax exemption, use the HRA Calculator.

🧮 Understanding the Three HRA Rules

Rule A is the actual HRA received from the employer. This prevents the exemption from exceeding the HRA that was actually paid during the period.

Rule B is based on city type: the source page uses 50% of Basic + DA for Metro and 40% for Non-Metro. The calculator changes this automatically when the city toggle changes.

Rule C is rent paid minus 10% of Basic + DA. If rent does not exceed that 10% threshold, Rule C becomes zero and the exemption can collapse to zero because the minimum of the three rules is then zero.

The three rules should be reviewed together. Increasing one input does not necessarily increase the final exemption if a different rule remains the minimum.

🏙️ Metro vs Non-Metro: Why City Classification Matters

The page treats Delhi, Mumbai, Kolkata and Chennai as Metro for the 50% Rule B calculation, while other cities use the 40% Non-Metro value according to the source content.

This difference can materially affect the ceiling under Rule B, especially at higher Basic + DA levels. However, a higher Rule B does not guarantee a higher final exemption because Rule A or Rule C may still be lower.

When moving cities during the year, calculate the two periods separately rather than using one city classification for the full financial year. This is especially important when a transfer changes Metro status mid-year.

For Government employees comparing payroll HRA by city category, the HRA X/Y/Z Cities Calculator is a different tool. Tax-exemption Metro/Non-Metro treatment and Government X/Y/Z HRA rates should not be mixed.

💰 Basic Salary, DA and HRA Received

The Basic Salary field should match the salary component used by the employer for HRA purposes. Do not enter CTC or full gross salary in this field.

DA should be entered only when it is relevant to the HRA salary base represented by your employment structure. Private-sector users often have no separate DA component, while Government employees may have a distinct DA amount.

HRA Received should come from the payslip or annual salary statement. The calculator uses this as Rule A, so an incorrect HRA input directly changes the exemption ceiling.

If you need to verify DA separately, use the DA Calculator. If you need to identify Basic Pay from a Government pay level, use the Pay Matrix Calculator.

🏠 Rent Paid and Rule C

Rule C is often the most misunderstood part of HRA exemption. The calculator subtracts 10% of Basic + DA from actual rent paid and uses the positive balance as the Rule C amount.

If rent is only slightly above 10% of salary, Rule C may be much lower than the HRA received. In that case, a large portion of HRA can remain taxable even though the employee is genuinely paying rent.

Use actual documented rent rather than an estimated number. Rent agreement, receipts and payment records make it easier to support the amount used in the calculation.

When rent changes during the year, split the year into periods and calculate each part separately. A single annual average can hide important changes in the minimum-rule calculation.

📅 Monthly vs Annual Calculation Basis

The page supports monthly and annual entry modes. Monthly mode multiplies the entered values by 12 before applying the three-rule test, while annual mode uses the values as entered.

Do not enter annual salary while monthly mode is active, because that would multiply the amount again and produce an exaggerated result. Likewise, monthly salary entered in annual mode would understate the exemption.

If salary or rent changed during the year, neither simple mode is enough by itself. Calculate each stable period separately and then add the exempt amounts.

Keeping the calculation basis consistent is one of the easiest ways to avoid large HRA errors.

⚔️ HRA Exemption and Tax Regime Choice

The source page states that HRA exemption under Section 10(13A) applies under the Old Tax Regime path represented here. The calculator therefore focuses on the exemption amount rather than comparing full annual tax under both regimes.

Use the Gross vs Net Salary Calculator when you want a wider New-vs-Old regime salary comparison that includes EPF, Professional Tax and estimated TDS.

A high HRA exemption can make the Old Regime more attractive in some salary structures, but it should be considered together with other deductions and the applicable slab structure rather than in isolation.

Keep one saved HRA result and then use that exempt amount as part of the broader tax comparison.

🧾 Documents to Keep for HRA Claims

Keep rent receipts, rent agreement and payment records for the period claimed. These support the actual rent figure used in Rule C.

If landlord PAN or employer declarations are required under the source page’s rules, keep those records with Form 12BB or the employer’s tax-proof submission.

If rent is paid to parents, maintain a genuine rent arrangement and payment trail. The page also notes that the recipient should account for the rent as income.

A saved calculator result should be stored with the same period’s salary statement so Basic, DA, HRA received and rent can be reconstructed later.

🏡 HRA and Home Loan Together

The source page discusses situations where HRA exemption and home-loan deductions may both be relevant. These are separate tax calculations and should be documented independently.

Use the HBA Calculator only for Government House Building Advance eligibility and repayment. HBA borrowing and HRA tax exemption are different topics even though both relate to housing.

When you own one property but rent another residence for work, keep ownership, work location and rental records clear. The HRA calculator itself only evaluates the three HRA rules from the inputs provided.

Do not add home-loan interest to the HRA exemption figure. Both should remain separate components in broader tax planning.

📄 Section 80GG vs Section 10(13A)

The comparison table on this page separates HRA exemption for salaried employees receiving HRA from rent deduction under Section 80GG for people who do not receive HRA.

These two routes should not be used interchangeably. If HRA is part of salary, the three-rule Section 10(13A) calculation is the relevant path shown by this calculator.

If HRA is not received, Section 80GG uses a different set of conditions and limits. Use the comparison table as a guide to determine which framework applies before calculating.

Keep the claim type clear in your tax records so the same rent is not accidentally treated under two different provisions.

⚠️ Common HRA Calculator Mistakes

A common mistake is entering gross salary instead of Basic + applicable DA. This can inflate Rule B and distort the exemption.

Another mistake is selecting Metro because a city is large. The calculator follows the specific Metro/Non-Metro classification represented in the source page, not population size alone.

Users may also forget to switch from monthly to annual mode when entering annual figures, causing the calculator to multiply values incorrectly.

Finally, a high HRA received does not automatically mean a high exemption. The minimum of all three rules determines the final tax-free amount.

✅ HRA Exemption Verification Checklist

Before accepting the result, confirm Basic Salary, DA, HRA received, rent paid, city type and monthly/annual basis.

Then review Rule A, Rule B and Rule C separately and confirm which one is highlighted as the minimum.

If the result differs from the employer’s tax statement, compare the period, city classification, salary base and rent evidence before changing the final exempt amount.

Keep a dated copy of the calculation with rent documents and salary records so later Form 16 or tax-return checks can be reproduced.

📌 Worked Verification Strategy

A reliable way to audit an HRA exemption is to reproduce the calculation from source documents rather than from memory. Take the salary slip for the relevant period, note Basic Salary, applicable DA and HRA received, then match the rent amount with the rent agreement or payment record.

Run the calculator once with those exact figures and note which of Rule A, Rule B or Rule C becomes the minimum. If the employer’s exemption differs, check city type and calculation period before changing any salary value.

For a mid-year transfer or rent revision, split the year into separate periods. Calculate each period with its own salary, rent and city classification, then add the exempt amounts. This is more accurate than using one annual average when the underlying conditions changed.

Keep the final working with the same year’s Form 16 or tax statement. That creates a simple audit trail showing how the exemption was derived and which rule limited the claim.

This same method is useful when your employer revises HRA exemption after submitting updated rent proofs during the year.

Frequently Asked Questions

Common queries about HRA exemption, metro cities, and tax-saving strategies

Which cities are Metro for HRA exemption in 2026?
▾
Under the current Income Tax Act, only 4 cities qualify as Metro for HRA tax exemption: Delhi, Mumbai, Kolkata, and Chennai. Employees in these cities can claim 50% of Basic+DA as Rule B. All other cities — including Bengaluru, Hyderabad, Pune, Ahmedabad, Noida, and Gurgaon — are Non-Metro and get 40%. The government has proposed expanding this to include Bengaluru, Hyderabad, Pune, and Ahmedabad, but this has not been officially notified for FY 2025–26.
Can I claim HRA if I live in my own house or parents’ house?
▾
No. HRA exemption is only available if you are actually residing in a rented accommodation and paying rent. If you live in your own house, you cannot claim HRA exemption — it will be fully taxable. However, if you pay rent to your parents (who own the house) and have a proper rent agreement + bank payment trail, you can claim HRA. Your parents must declare the rent as income in their ITR.
Is HRA exemption available under the New Tax Regime?
▾
No. HRA exemption under Section 10(13A) is available only under the Old Tax Regime. If you opt for the New Tax Regime (which offers lower slab rates), you forfeit HRA exemption, and the entire HRA received is added to your taxable income. Before choosing a regime, use an HRA exemption calculator to compare your net tax liability under both options.
My rent is less than 10% of basic — can I still claim HRA?
▾
No. If your annual rent paid is less than or equal to 10% of Basic+DA, then Rule C becomes zero (₹0 or negative). Since HRA exemption = Minimum of A, B, C, the result is ₹0 — meaning no HRA exemption at all. The entire HRA received becomes taxable. You should ensure your rent is at least meaningfully higher than 10% of Basic+DA to claim any exemption.
Do I need to submit rent receipts to claim HRA?
▾
Yes. Rent receipts are required to submit to your employer for HRA exemption in Form 12BB. If your annual rent payment exceeds ₹1,00,000 (₹8,333/month), you must also provide the landlord’s PAN card number. Even if your employer accepts a declaration, the Income Tax Department may ask for documentary evidence during assessment, so always maintain rent agreements and receipts.
Can I claim both HRA exemption and home loan tax benefit together?
▾
Yes, both can be claimed simultaneously under specific conditions. If you own a house in City A (with a home loan) but are working and renting in City B, you can claim HRA exemption for your rented accommodation and home loan interest deduction u/s 24(b) and principal u/s 80C for your owned property. Both cannot be claimed if you own and reside in the same property where you are claiming HRA.
How does HRA work if I changed cities mid-financial year?
▾
If you changed cities during the financial year, calculate HRA exemption separately for each period. For months in a Metro city, apply 50% for Rule B. For months in a Non-Metro city, apply 40%. Apply the three-rule minimum for each period independently, then add the exempt amounts for the full year. Update your employer via Form 12BB whenever your city changes.
What is Section 80GG and who should use it?
▾
Section 80GG is for individuals who do not receive HRA as part of their salary — typically self-employed professionals, freelancers, or salaried employees whose CTC does not include an HRA component. The deduction is the minimum of: (1) ₹5,000/month (₹60,000/year), (2) 25% of total income, or (3) Rent paid minus 10% of total income. You must file Form 10BA to claim this deduction and should not own a house anywhere in India.

Disclaimer: This calculator is for informational purposes only and is based on Section 10(13A) of the Income Tax Act, 1961. HRA exemption rules may change with new budget notifications. Always consult a Chartered Accountant (CA) or tax advisor for your personal tax planning. For official rules, visit Income Tax India Portal or Ministry of Finance.