HRA Calculator and Exemption Provisions

The following is a summary of the provisions of Indian income Tax Act 1962 for determining the HRA exemption amount.these provisions are applicable for both current assessment year 2015-2016 and for previous assessment year 2014-2015. If you are a salaried individual and is already aware of the provisions, you may directly proceed to use our HRA Calculator for ascertaining the non-taxable portion of HRA received from your employer.

HRA Provisions under Indian Income Tax Act

As per Section 10(13A) of the Indian income Tax Act 1962 and Rule 2A of the Income Tax Rules, House Rent Allowance (HRA) received from the employer is exempt from tax to the extent of the least of the following:

  • Actual annual HRA received from the employer.
  • Rent paid in excess of 10 percent of salary.
  • 50 percent of annual salary, if the employee lives in the four metro cities of Delhi, Mumbai, Chennai and Kolkata or 40 percent of annual salary if the employee lives in any other tow or city in India.

Annual salary is aggregate of Basic salary, Dearness allowance and commission, if any based on fixed percentage of turnover, received during the 12 month period of the financial year (April to March).

However one must keep in mind that HRA exemption under the provision of section 10(13A) of the ACT is available only for salaried individuals and not for self-employed people. Section 80GG of the the Act provides similar provisions for self-employed people to claim tax exemption in respect of rent paid on their leased accomodation.

Determine your HRA exemption amount using our free calculator below. You don’t need an Excel tool for calculating this.

HRA Calculator

Calculation of HRA Taxable and Exempt Amount
Annual Basic Ssalary
Dearness Allowance
Commission Received on Turnover
Annual HRA Received
Annual Rent Paid
City in which you live
HRA Exemption Amount
HRA Taxable Amount
40% of Salary
50% of Salary
Rent Paid in excessof 10% of salary

Check out our Income Tax Calculator.

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