Calculate HRA tax exemption

  • My house is in a:

  • Basic Salary

  • HRA Received

  • Total Rent Paid

  • Dearness Allowance

You are now eligible to claim deductions of up to Rs. 60,000 under Section 80GG, even if you do not have HRA allowance.

Calculate Reset

Result

  • Taxable HRA:

    ₹ 36,000

  • Exempted HRA:

    ₹ 36,000 /Year
Select tax slab:
Tax @5%

₹ 6,350

All you need to know about HRA calculators

Other Calculators
What is HRA?

House Rent Allowance or HRA is a component of salary provided by employers to employees to meet their rental expenses. HRA can be claimed as a tax deduction under the Income Tax Act. The amount of HRA received depends on factors such as the employee's salary, the actual rent paid, and the city of residence. However, the tax exemption on HRA is subject to certain conditions and limitations, such as the actual HRA received, rent paid to exceed 10% of salary, and availability of rent receipts. HRA serves as financial aid for individuals to manage their housing expenses while also providing tax benefits.

What is a HRA calculator?

There are many portals and services online that will calculate the amount of your HRA tax exemption for you. Online HRA calculators in India are quick and easy ways to compute this tax deduction component. HRA calculators online will ask you to input your salary details and compute your HRA for you. This way, you can avoid mistakes in the HRA formula. TaxFilr's HRA calculator in India is an effective and painless way to calculate your HRA exemption without errors.

How to Use ET Money HRA Calculator?

ET Money's HRA calculator is the simplest way to compute your HRA exemption. By following simple steps, you can easily find out how much HRA you can claim as an exemption and accurately calculate your income tax liability.

Here is the step-wise process to go about it

  • A Fill in your basic salary.
  • B Enter the dearness allowance amount.
  • C Enter how much HRA allowance you have received from your employer.
  • D Select the location of your residence.
  • E Enter the total rent paid amount.

After entering all the information, the calculator will show you the taxable HRA amount and applicable tax on the HRA. Also, it will show the HRA amount exempted from taxation.

How to calculate HRA tax exemption in India

HRA calculations are based on several factors, as mentioned above. However, the amount of HRA tax exemption that you can claim is the lowest of the following three provisions:

  • The amount of HRA paid to you by your employer
  • The actual rent you pay for housing minus 10% of the basic pay

In point 3, salary means basic salary plus dearness allowance and any commissions you may be paid. No other allowances are taken into consideration for HRA deduction. The way to compute the HRA formula is to calculate the above three and then claim the lowest amount as HRA deduction

Formula to calculate HRA exemption: with example

To understand the HRA calculation formula better, let us consider an example. Ms. Ishika Gupta works for an MNC in Kolkata. She lives in a rented house, paying ₹10,000 per month. Her salary structure looks like this:

Component

Amount (INR/ ₹)

Basic Pay

30,000

HRA

13,000

Allowances

7,900

Provident fund

3,600

Total Salary

54,500

When Ms. Gupta applies the HRA formula, she gets:

  • An annual HRA of ₹1,56,000 as sanctioned by her employer (₹13,000 X 12 = ₹1,56,000)
  • Actual rent paid is ₹ 1,20,000 per year. Using the HRA calculation formula of actual rent minus 10% of basic pay, she gets ₹ 84,000 (₹10,000 X 12 - ₹36,000 = ₹84,000)
  • Since she lives in a metro, 50% of her basic salary would be ₹1,80,000

The lowest of the three is ₹84,000, which she can claim as an HRA tax exemption. In order to avoid confusion, you can use HRA exemption calculators online to ascertain your HRA deduction.