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    Home › Free tools › HRA Exemption
    Free tool

    HRA Exemption Calculator

    Find your tax-exempt HRA — under Section 10(13A), old tax regime.

    Your salary & rent

    Enter monthly figures. HRA exemption applies only under the old tax regime.

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    Metro (50%) from FY 2026-27: Mumbai, Delhi, Kolkata, Chennai, Bengaluru, Pune, Hyderabad, Ahmedabad. All other cities are non-metro (40%).

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    Your estimate

    HRA exempt from tax / month—
    • Actual HRA received —
    • Rent − 10% of Basic+DA —
    • 50% of Basic+DA —
    • Exempt HRA (least of three) —
    • Annual exempt —
    • Taxable HRA / mo —
    • Old-regime tax —
    • New-regime tax —
    • Recommended —

    Estimate only. HRA exemption under Section 10(13A) is available only if you opt for the old tax regime and applies to the least of: actual HRA received, rent paid minus 10% of Basic+DA, or 50%/40% of Basic+DA for metro/non-metro cities. The new tax regime does not allow HRA exemption. FY 2026-27 rules; consult a tax adviser for your specific case.

    How it works

    How HRA exemption is calculated in India

    House Rent Allowance (HRA) is part of many salary structures, and a portion of it can be exempt from income tax under Section 10(13A) of the Income Tax Act — but only if you choose the old tax regime for the financial year. The exempt amount is the least of three numbers: the actual HRA your employer pays you, the rent you actually pay minus 10% of your Basic + Dearness Allowance (DA), and 50% of Basic+DA if you live in a metro city or 40% if you live elsewhere. Whichever of these three is smallest becomes your tax-free HRA; the rest is added back to your taxable salary.

    Which cities count as ‘metro’?

    From FY 2026-27, the metro (50%) rate applies to eight cities: Mumbai, Delhi, Kolkata, Chennai, Bengaluru, Pune, Hyderabad and Ahmedabad. Every other city in India — including Gurugram, Noida, Jaipur, Chandigarh, Surat, Lucknow, Kanpur, Indore, Coimbatore and Nagpur — is treated as non-metro, giving a 40% ceiling instead of 50%. This widened the metro list from the earlier four cities (Mumbai, Delhi, Kolkata, Chennai), so employees in Bengaluru, Pune, Hyderabad and Ahmedabad now get the higher exemption ceiling.

    Old regime vs new regime

    HRA exemption is only available if you file under the old tax regime, where you can also claim deductions like 80C and home loan interest. The new (default) tax regime offers lower slab rates but does not allow HRA exemption or most other deductions — so employees paying significant rent often find the old regime works out cheaper once HRA exemption is factored in. Run the numbers under both regimes before choosing, since the right answer depends on your full deduction profile, not HRA alone.

    FAQ

    HRA exemption questions, answered

    Can I claim HRA exemption 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 (default) regime, your entire HRA is taxable, regardless of rent paid.
    How is the HRA exemption calculated?
    The exemption is the least of three amounts: the actual HRA received; rent paid minus 10% of Basic + DA; and 50% of Basic + DA for a metro city or 40% for a non-metro. The calculator works out all three and uses the smallest.
    Which cities get the 50% HRA rate?
    From FY 2026-27, eight cities qualify for the 50% metro rate: Mumbai, Delhi, Kolkata, Chennai, Bengaluru, Pune, Hyderabad and Ahmedabad. All other cities use the 40% non-metro rate.
    Old regime or new regime if I pay rent?
    It depends on the numbers. The old regime lets you claim HRA and other deductions; the new regime has lower slab rates but no HRA. The calculator weighs your HRA exemption plus other deductions against the new regime’s lower slabs and recommends whichever leaves you paying less tax.
    Can I claim HRA exemption if I don’t pay rent?
    No. HRA exemption requires actual rent payment. If you live in your own house or pay no rent, your full HRA is taxable. You typically need rent receipts, and a landlord PAN if annual rent exceeds ₹1,00,000.
    Does Kredily handle HRA in payroll?
    Yes. Kredily lets employees declare rent and regime choice, computes HRA exemption automatically each cycle, and reflects it in payslips and Form 16 — free for unlimited employees on the Free Forever plan.

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