HRA calculator for India: exempt and taxable HRA in 2026-27
Enter basic pay plus DA, the HRA on the payslip, the rent and the city to see how much HRA is exempt and how much is taxed.
Results
HRA exempt for the year
0.00
The lowest of the three limits below. It lowers taxable salary in the old regime only.
- HRA exempt for the year
- 0.00
- Taxable HRA for the year
- 0.00
- HRA exempt a month
- 0.00
| Limit | Amount | Result |
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For information only, not financial, tax or legal advice.
Last updated . Method checked . Rates checked 2 November 2026. Methodology
House rent allowance is part of many salaries in India, and some of it can stay out of taxable income while you live in a rented home. Rule 279 of the Income-tax Rules 2026 sets the exempt part as the least of three amounts: the HRA received, the rent paid less 10% of basic pay plus DA, and 50% of basic pay plus DA in Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad or Bengaluru, or 40% anywhere else. Enter the monthly figures from a payslip and a rent receipt, then pick the city and the months you rented during tax year 2026-27. The calculator lists each limit, marks the lowest, and gives the exempt and taxable HRA for the year and for a month. The exemption only counts in the old regime, because section 202 of the Income-tax Act 2025 taxes the whole HRA in the new one. The sums run inside this tab and nothing you type leaves it.
How to use the HRA Calculator
- Enter basic pay plus DA for one month, as the payslip shows it.
- Enter the HRA received and the rent you pay each month.
- Pick the city of the rented home, or Any other place. Tip: Only the eight cities that the rule names get the higher limit.
- Lower the months rented if you rented for part of the tax year.
- Read the three limits, the exempt HRA and the taxable HRA.
Worked example
A salaried employee who rents a flat in Bengaluru for the whole of tax year 2026-27 and is taxed under the old regime. All figures are INR.
| Input | Value |
|---|---|
| Basic pay plus DA | INR 50,000.00 a month |
| HRA received | INR 20,000.00 a month |
| Rent paid | INR 18,000.00 a month |
| City and months | Bengaluru, 12 months |
Basic pay plus DA for the year = 50,000 x 12 = 6,00,000 Limit 1, the HRA received = 20,000 x 12 = 2,40,000 Limit 2, rent less 10% of basic plus DA = 2,16,000 - 60,000 = 1,56,000 Limit 3, 50% of basic plus DA in Bengaluru = 3,00,000 Exempt HRA = the lowest limit = 1,56,000, which is 13,000 a month Taxable HRA = 2,40,000 - 1,56,000 = 84,000
- HRA exempt for the year
- INR 1,56,000.00
- Taxable HRA for the year
- INR 84,000.00
- HRA exempt a month
- INR 13,000.00
The rent limit is the lowest here. Rent of 30,000 a month would lift it to 3,00,000, and the HRA received of 2,40,000 would then be the lowest, so all of the HRA would be exempt.
How the HRA exemption is worked out
S = basic pay + DA (where the terms of employment count DA), for the months rented
Limit 1 = HRA received over the same months
Limit 2 = rent paid - 10% x S, never below 0
Limit 3 = 50% x S in the eight named cities, 40% x S anywhere else
Exempt HRA = the least of the three limits, and 0 with no rent; taxable HRA = HRA received - exempt HRA
Schedule III of the Income-tax Act 2025 exempts part of a house rent allowance when the employee pays rent for a home they do not own. Rule 279 of the Income-tax Rules 2026, in force from 1 April 2026, sets how much. Every limit is measured over the same stretch: the months of the tax year the rented home was lived in. The calculator takes monthly amounts and multiplies each by the months entered, so a full year is twelve times the monthly figure.
S is the salary the rule means, which is basic pay plus dearness allowance where the terms of employment include it. Bonuses, special allowances and perquisites are not part of S, even when the payslip groups them with basic pay.
Limit 2 subtracts 10% of S from the rent. When the rent is that small or smaller, the limit is zero and so is the exemption, whatever the other two limits are. Limit 3 depends on the city. Rule 279 names Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru for 50%, and every other place gets 40%.
The exempt HRA is the lowest of the three, and the table under the result marks which one it is. What is left of the allowance is added to taxable salary. Amounts are kept to the paisa, and the monthly figure is the yearly one divided by the months.
The exemption lowers tax only in the old regime. Section 202(2) of the 2025 Act lists what the new regime allows a salaried person, and the HRA exemption is not on it. So the result here matters to someone who opts out of the new regime, and the income tax calculator for India shows what that choice does to the tax. The percentages and the city list come from the same rates file that tool reads, checked on 2 November 2026.
An edge case: an employee with no HRA in the salary who pays rent cannot use this rule at all. Section 134 (80GG) has a separate deduction for that case, which is not worked out here.
Frequently asked questions
How is the HRA exemption calculated?
Rule 279 takes the least of three amounts for the months you rented: the HRA received, the rent paid less 10% of basic pay plus DA, and 50% of basic pay plus DA in one of the eight named cities or 40% elsewhere. With basic plus DA of 50,000 a month, HRA of 20,000 and rent of 18,000 in Bengaluru, the three limits for the year are 2,40,000, 1,56,000 and 3,00,000, so 1,56,000 is exempt.
Which cities get the higher HRA limit?
From 1 April 2026, Rule 279 of the Income-tax Rules 2026 names eight: Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru. Rent paid for a home in any of them is measured against 50% of basic pay plus DA, and rent anywhere else against 40%. The rule prints the names without drawing city limits, so the calculator offers the eight names and one choice for every other place.
Can HRA be claimed in the new tax regime?
No. Section 202(2) of the Income-tax Act 2025 leaves the HRA exemption out of the new regime, which applies unless a person opts out, so under it the whole allowance is taxed with the salary. The exemption on this page lowers tax only in the old regime. The India income tax calculator works out both regimes at once, with the HRA exemption counted in the old one.
What if I pay no rent or live in my own home?
Then nothing is exempt and all of the HRA is taxable. The exemption needs rent actually paid for a home the employee does not own, so someone living in their own flat, or with family without paying rent, gets none. The calculator shows zero whenever the rent is zero, and also when the rent is no more than 10% of basic pay plus DA.
Does dearness allowance count as salary for HRA?
Only when the terms of employment count it. For this rule, salary means basic pay plus dearness allowance where the terms include DA, and it leaves out every other allowance and perquisite. Enter basic pay alone when the DA does not count. A higher salary figure raises the third limit and lowers the second, so the exempt amount can move either way.
Guides for this tool
Sources
- Income-tax Rules, 2026, Rule 279: the least of three limits, rent less 10% of salary, and 50% of salary in Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru or 40% elsewhere (G.S.R. 198(E) of 20 March 2026, read from an Internet Archive capture) checked 2 November 2026
- The Income-tax Act, 2025: Schedule III Sl. 11 (the HRA exemption for rent actually paid on a home not owned) and section 202(2) (no HRA exemption in the new regime), read from an Internet Archive capture checked 2 November 2026