How is HRA exemption calculated?

Lesson 26 of 28 · Your HRA exemption · 3 min read · Reviewed 15 Oct 2026

Quick answer

In the old regime, the tax-free part of HRA is the lowest of three numbers: the HRA you get, the rent you pay minus 10% of basic, and 50% of basic in Mumbai, Delhi, Kolkata or Chennai (40% elsewhere). With ₹6 lakh basic, ₹3 lakh HRA and ₹3 lakh rent in a metro, ₹2.4 lakh is exempt.

House rent allowance is part of many salaries. If you rent your home, part of it can be tax-free under the old regime.

The rule takes the lowest of three numbers, so paying more rent helps only up to a point.

Key idea: HRA exemption needs the old regime. Keep rent receipts, and give your landlord’s PAN if rent is above ₹1 lakh a year.

Try the calculator and the one-question quiz on this page to check your own numbers.

Common questions

Can I claim HRA if I pay rent to my parents?

Yes, if you really pay them and they own the home. They must show the rent as income.

Can I claim HRA and a home loan together?

Yes, if you rent where you live and the home you own is elsewhere or not yet ready, among other cases. Ask your CA about yours.

I don’t get HRA. Is there anything for rent?

Section 80GG gives a smaller deduction in the old regime for people who don’t receive HRA.

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