Financial Guide

HRA Exemption Calculator FY 2026-27

If you live on rent and choose the old tax regime, part of your HRA is tax-free. Find the exact exempt amount in seconds.

HRA Exemption Calculator

Basic salary + DA (₹ per month)

HRA received (₹ per month)

Rent paid (₹ per month)

City you live in

HRA exempt per year

₹1,56,000

Taxable HRA per year

₹84,000

Limit that applied

Rent paid − 10% of salary

Test (yearly)	Amount
Actual HRA received	₹2,40,000
Rent paid − 10% of salary	₹1,56,000
50% of salary	₹3,00,000

HRA exemption is available only under the old tax regime. Rent above ₹1 lakh a year needs your landlord’s PAN. The four newly added cities apply from FY 2026-27 under the Income Tax Rules, 2026.

Updated October 2026 · Reviewed against our calculation methodology

How HRA Exemption Is Calculated

The tax-free HRA is the lowest of three amounts, worked out for the year:

1. Actual HRA received
2. Rent paid − 10% of (basic + DA)
3. 50% of (basic + DA) in the 8 metro cities, 40% elsewhere

Example: Basic ₹50,000 a month, HRA ₹20,000, rent ₹18,000 in Delhi. Yearly: HRA ₹2.4 lakh; rent − 10% of salary = ₹2.16 lakh − ₹60,000 = ₹1.56 lakh; 50% of salary = ₹3 lakh. Exempt HRA is ₹1,56,000; the remaining ₹84,000 is taxable.

Metro Cities for HRA (from FY 2026-27)

The Income Tax Rules, 2026 extend the 50% limit from four cities to eight: Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Pune and Ahmedabad. Gurugram, Noida and other cities stay at 40%. Check with your employer if your FY 2026-27 payroll still uses the older four-city list.

Rules to Remember

Available only under the old tax regime.
Rent above ₹1 lakh a year requires the landlord’s PAN.
You can pay rent to your parents if they own the house and declare the rent as income — but not to your spouse.
If you don’t receive HRA at all, Section 80GG may allow up to ₹60,000 a year instead.