Tax Guide
HRA Exemption Guide — How to Save Tax on House Rent India 2026
🏠 Calculate HRA Tax Exemption
Instant HRA exemption with all three conditions checked.
Open HRA Calculator →HRA Exemption — Three Condition Rule
HRA exemption under Section 10(13A) is the minimum of three conditions:
Condition 1: Actual HRA received from employer
Condition 2: Rent paid − 10% of Basic Salary
Condition 3: 50% of Basic (Metro) or 40% of Basic (Non-Metro)
Exemption = Minimum of above three
Metro vs Non-Metro Cities
Metro cities (50% rule): Delhi, Mumbai, Chennai, Kolkata
Non-metro (40% rule): All other cities — Bangalore, Hyderabad, Pune, Ahmedabad etc.
⚠️ Important: Bangalore, Hyderabad and Pune are NOT metros for HRA purposes despite being major cities. You get only 40% of Basic as HRA exemption limit.
HRA Example Calculation
- Basic salary: Rs.50,000/month
- HRA received: Rs.20,000/month
- Rent paid: Rs.18,000/month
- City: Non-metro (40%)
- Condition 1: Rs.20,000
- Condition 2: Rs.18,000 − Rs.5,000 (10% of 50K) = Rs.13,000
- Condition 3: Rs.50,000 × 40% = Rs.20,000
- Exemption = Rs.13,000/month (minimum) = Rs.1.56 lakh/year
HRA in New vs Old Tax Regime
Critical: HRA exemption is only available under the OLD tax regime. If you opt for the new regime, no HRA benefit — but you get lower tax rates and 0% up to Rs.12L.
- If your HRA exemption + 80C + home loan = more than Rs.3.75 lakh → old regime may save more
- Use our income tax calculator to compare both regimes