How to calculate House Rent Allowance Exemption-HRA for salaried employees to claim tax exemption? - Professionals - Taxation - TIK Share
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How to calculate House Rent Allowance Exemption-HRA for salaried employees to claim tax exemption?


Prakash mehta

2015-07-19

I am getting salary from one of the college. They deduct TDS, which I feel is more. How do i set my salary structure to most efficient tax saving plan?

What is House Rent Allowance (HRA) and how to calculate the tax liability on HRA?

CA Pulkit Sharma

2015-07-19

House Rent Allowance or HRA is the most common allowance provided to any salaried employee. HRA is exempted under Income Tax Act upto a certain limit specified.

The limits and provisions covering HRA exemption are listed below.

You can claim your HRA exemption upto minimum of:

Person living in Metro cities (Mumbai, Delhi, Kolkata or Chennai):

  1. Actual HRA Allowance
  2. Rent paid in excess of 10% of basic salary
  3. 50% of Basic Salary

Person living in Non-Metro cities ( other than Mumbai, Delhi, Kolkata or Chennai):

  1. Actual HRA Allowance
  2. Rent paid in excess of 10% of basic salary
  3. 40% of Basic Salary

HRA exemption is to be calculated for each month. If there is any change in any of the factors listed above, HRA exemption should be re-calculated.

You can Download HRA calculator in Excel from the link.  HRA-calculator-in-Excel.xlsx 

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CA Pulkit Sharma

2015-07-19

You can use this excel sheet from zoho to calculate HRA.

HRA Calculator online, HRA Calculator in Excel, Download HRA calculator

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News Reporter

2015-07-28

This is one great post to download HRA calculator for salaried employees.

Here is my doubt how do I calculate House Rent Allowance (HRA) exemption?

My HRA allowance is Rs. 25000 PM, however I changed house for 3 times during the year and actual rent expenses were different everytime.

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CA Pulkit Sharma

2015-07-28

You need to calculate HRA exemption monthwise. Download the HRA calculator, put amount for every month and total for each month.

Actually HRA exemption should be calculated on monthly basis if rent changed during the year.

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