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HRA Calculator

Excemted HRA
Taxable HRA
Tax Slab Tax Saving as per Old Regime (Including cess)
5% ₹5200
20% ₹20800
30% ₹31200
HRA Exemption Calculator
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This is the amount paid to the employee without any additions or allowances.
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Cost of living adjustment allowance paid to government employees and pensioners. Please enter 0 if you do not receive any dearness allowance.
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A component of the salary given by a company to its employee to meet house renting expenses.
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Total rent paid by the employee in the given financial year.
Do you live in metros like Delhi, Mumbai, Kolkata or Chennai?*

Save up to ₹31200 Tax

with Digit Health Insurance

Taxable HRA

  • 40% of Basic Salary
    0
  • HRA received
    0
  • Excess of Rent paid over 10% of salary
    0
  • Amount of exempted HRA
    0
  • HRA chargeable to Tax
    34,434

Save up to ₹31200 Tax

with Digit Health Insurance

How to Calculate HRA Tax Exemption - Explained

What is HRA Calculator?

hra calculator

What is HRA Calculator?

A house rent allowance calculator is an online financial tool that helps in computing the amount that an individual can enjoy as tax benefit each year on his/her house rent allowance as per the Income Tax Act, 1961. This online calculator aids in simplifying the otherwise cumbersome task of computing tax benefits.

Formula to Calculate HRA Exemption

Example of HRA Exemption

How to use HRA Calculator online?

Manually determining your HRA deduction can be problematic and time-consuming. Thankfully, finding a quality HRA exemption calculator is relatively simple. Once you find such a tool, simply follow the steps mentioned below to determine your yearly HRA benefits.

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Step 1

Open the calculator page and fill the appropriate fields with your basic salary amount, dearness allowance earnings, HRA amount and your total rent.

Step 2

Next, choose whether you reside in a metropolitan city or a non-metro city and verify all the data that you entered once again to prevent any errors.

Step 3

Finally, click on “calculate” button and know your hra.

Benefits of using an HRA Exemption Calculator

benefits of using hra calculator

Benefits of using an HRA Exemption Calculator

If you are wondering whether you are better off avoiding such online calculators, following are some benefits of using these tools that you should consider:

  • These calculators ensure swift calculations of your HRA claims. Manual calculations tend to be much slower.
  • Calculators never make mistakes when displaying results. The same cannot be said for manual calculations, where unforeseen errors are always a possibility.
  • An HRA calculator considers all of the variables that go into calculating HRA benefits, starting from your basic salary to the city you reside in.
Concisely, such a calculator simplifies the task of determining your HRA exemptions for a particular year, based on income and other factors. You can even calculate the same while filing your year-end taxes.

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Eligibility Criteria to avail HRA Exemptions

eligibility criteria for hra exemption

Eligibility Criteria to avail HRA Exemptions

Not every salaried employee can claim these benefits while filing taxes, because one needs to meet specific criteria to take advantage of the same. Here are some factors that decide your eligibility for HRA exemptions:

  • You must be a salaried employee.
  • Your employer must include an HRA component in your monthly payments.
  • You have to pay rent to qualify for House Rent Allowance tax benefits.
  • You should not own any residential property.
  • You should not receive rent from any property that you may own.

As you can understand from the requirements listed above, self-employed individuals cannot claim this tax benefit.

Homeowners can avail of HRA exemptions, along with the applicable tax benefits on home loan interest and principal payments, under two conditions.

You qualify for HRA if your owned property is rented out, but you do not receive the said rent (a family member may receive the rent on your behalf).

Alternatively, you can be a property owner and still claim HRA benefits if you reside in a different city than where your owned property is located.

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Things to Keep in Mind When Calculating House Rent Allowance Exemptions

things to know when calculating hra exemptions

Things to Keep in Mind When Calculating House Rent Allowance Exemptions

When calculating HRA deductions, you must keep the following guidelines in mind:

  • Allocated HRA cannot exceed 50% of your basic salary.
  • Salaried employees cannot claim for deduction of the full rental amount. Instead, the least amount of the three provisions will be deemed as a suitable exemption.
  • Tax benefits of HRA are available alongside home loan tax rebates.
  • If annual rent is higher than Rs.1 lakh, your landlord’s PAN card must be presented to claim HRA benefits.
  • If you live with your parents, you can pay rent to them and collect an HRA receipt for the transaction. However, you cannot claim HRA benefits by paying rent to your spouse or partner.
  • If your landlord is an NRI, you will need to deduct 30% tax from the rent amount before presenting it for HRA deductions.

 

If these calculations prove too tricky for you, you can always use an HRA calculator to determine your yearly income tax savings under this provision.

FAQs about HRA Exemption Calculator