House Rent Allowance Calculator

Please fill below details to calculate HRA Exemption/Tax benefit for House Rent paid

Questions and Answers on House Rent Allowance Calculator

House Rent allowance or commonly known as HRA, is an amount paid by employers to their employees as a part of their salary to meet expenditure incurred on payment of rent (by whatever name called) in respect of residential accommodation occupied by the employee. If you live in a rented accommodation, then you can claim full or partial HRA exemption u/s 10. However, HRA is fully taxable if you don’t live in a rented accommodation.
HRA is provided to meet expenditure incurred on payment of rent and considering the actual expenditure incurred on rent, income tax provide exemption from amount of HRA received by employee.

HRA is exempt to the least of following limit: -

Metro Cities Non Metro Cities
House Rent Allowance actually received House Rent Allowance actually received
Rent Paid less 10% of salary Rent Paid less 10% of salary
50% of salary 40% of salary

'Salary' for this purpose includes basic salary as well as dearness allowance if the terms of employment so provide. It also includes commission based on a fixed percentage of turnover achieved by an employee as per terms of contract of employment but excludes all other allowances and perquisites. Exemption is denied where an employee lives in his own house or in a house for which he does not pay rent.

Yes, you can claim HRA exemption by paying rents to your parents. For claiming deduction of HRA all you need is valid rent agreement and proof of rent payment.So you can enter into a rental agreement with your parents and pay monthly rent to your parents. Your parents should disclose the rent received from you as “income from House property”.
If you forgot to submit the rent receipts to your employer, your employer might not provide you HRA exemption. In such scenario you can claim HRA exemption directly into your income tax return. After processing of your income tax return the department may ask you to upload the rent receipts on the Income Tax website. So you have to make sure that you are ready with your rent receipt to upload it on department website and claim the HRA deduction.
As per a circular issued by the Central Board of Direct Taxes (CBDT) (CIRCULAR NO. 8/2013, October 10, 2013) if annual rent paid by the employee exceeds Rs.1 lakh per annum, it is mandatory for the employee to report PAN of the landlord to the employer.

In case the landlord does not have a PAN or does not provide you the PAN you have the following options.
  • You can get a declaration to this effect from the landlord along with his name and address and same should be filed by the employee to his employer.
  • To substantiate the claim, the employee needs to keep a record of the rent agreement/lease deed, rent receipts, intimation to the society for the occupancy etc
  • In case you are paying through banking channels, you need not worry as you can substantiate the payment easily through your bank statement.
  • In case you are not paying through banking channels, ensure that in future rent payments are made through banking channels as cash transactions may not be considered genuine
An individual must be paying rent for claiming HRA deduction which means an individual can not claim HRA exemption residing in his own house. Also, HRA and home loan deductions are treated under different sections of Income Tax Act. While the exemption for HRA can be claimed under section 10(13A) of Income Tax Act, deduction for principal repayment of home loan and interest on it can be claimed under section 80C and 24B respectively.

You can claim HRA along with home loan only when you are not residing in your own house for which you have taken the loan In following scenarios you can claim both deductions
  • When assessee owns a house in another city.
    For example:
    Prasad works with a company in Delhi and staying in a rented apartment. At the same time, Prasad has bought a property in Jaipur for which he has taken home loan. Since Prasad cannot stay in his own house in Jaipur as he is working in Delhi, he is eligible to claim deduction for both HRA and home loan interest and principal.
  • If a person takes home loan and buys a house which is under construction, then he will be eligible to claim deduction for HRA.
  • When a person owns a house but is unable to move in.
  • When a person resides in a rented house and rents his own house.

The deduction available is the minimum of the following amounts–

  • HRA received (if you have stayed in rented accommodation for part of the year, consider HRA for only that part).
  • 50% of your Basic Salary when you live in a rented place in Mumbai, Calcutta, Delhi or Chennai OR if you are in any other city 40% of your Basic Salary
  • Rent paid (proportion of rent paid by you) less 10% of Basic Salary

  • So, HRA for shared flat is calculated in the same way as normal HRA the only difference is, here you claim HRA on your share of rent paid. Click here to know more about HRA.

    Please Note :-

    1. In order to claim HRA , you need to submit rent receipts to your employer. Also, you are required to have a proper rent agreement , which can be submitted to your employer if asked by him.
    2. You need to provide PAN of landlord as well, if your annual rent exceeds Rs. 1,00,000.
    3. You can generate rent receipts from our myITreturn App. Click here to download the myITreturn app.
You are required to submit the following documents to claim HRA exemption: -
  1. PAN Card details of landlord in case rent paid is greater than Rs.1 lac per annum.
  2. Rent receipt
  3. Photocopy of rent agreement if required.
Yes, even if you are not receiving HRA you can claim exemption of rent paid u/s 80GG of income tax act.

Under section 80GG, you can claim least of the following as tax benefit:-

  • Rs. 60,000 per year (i.e. Rs. 5,000 per month).
  • An amount equal to the total rent paid minus 10% of the total income.
  • 25% of total income of employee.
Yes, if both of them are paying rent to the landlord and both can furnish separate rent receipts then then can claim HRA Tax benefit separately.

In case if both the spouse claim HRA deduction from same rent receipt then income of landlord will get wrongly considered twice.