HRA Exemption

Calculate your tax-exempt House Rent Allowance based on income and rent paid.

Basic Salary (Monthly)

₹

HRA Received

₹

Rent Paid

₹

Living in a Metro City (50% Basic)

Expected Return (p.a.)

Time Period (Years)

Yrs

Taxable HRA

₹1,97,500

HRA Received

₹5,000

HRA Exemption

₹2,500

You invest ₹5,000 every month for 20 years. At an estimated 12% annual return, your total investment is ₹2,00,000 and the estimated total value is approximately ₹1,97,500. Around ₹2,500 represents estimated growth.

Next Architectural Steps

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How it works

Finds the least of: HRA received, rent minus 10% of salary, or 40/50% of basic.

The formula

min(HRA, Rent - 10% Basic, 50% Basic)

HRA: House Rent Allowance
DA: Dearness Allowance

Worked example

₹50k basic, ₹20k HRA, ₹25k rent in a metro city.

Pro tips

Ensure you have a valid rent agreement.
Rent to parents can also be claimed if they declare it as income.

Common mistakes

Thinking 100% of rent is exempt.

Go deeper

Concepts to explore

Rules for HRA Exemption

Institutional grade calculations are illustrative and for educational wealth architecture. Results do not constitute investment advice.