The exempt part of HRA is the least of three amounts: the HRA received, rent paid minus 10% of salary, and 50% or 40% of salary depending on the city. Everything runs in your browser; nothing you type is saved or sent.
HRA exemption
The least of three amounts is exempt; the rest of the HRA is taxed.
₹6 lakh
₹2.4 lakh
₹2.4 lakh
Exempt HRA
₹1,80,000
HRA received: ₹2,40,000
Rent paid minus 10% of salary: ₹1,80,000
40% of salary: ₹2,40,000
Taxable HRA ₹60,000
The exemption is available only under the old tax regime. For 2026-27 onwards, 50% applies in Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Pune, Ahmedabad; 40% everywhere else. Salary here means basic pay plus DA that counts for retirement benefits. An employer will ask for the landlord's PAN when rent is above ₹1 lakh a year.
Sources: 2026-27 onwards: Income-tax Act, 2025 and Income-tax Rules, 2026, notified 20 March 2026 (G.S.R. 198(E)), in force 1 April 2026; 2025-26: section 10(13A) of the Income-tax Act, 1961 and rule 2A of the Income-tax Rules, 1962; checked 1 October 2026.
Common questions
Which cities get the 50% HRA limit?
From 2026-27, under the Income-tax Rules, 2026: Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Pune and Ahmedabad. For 2025-26 and earlier, only Delhi, Mumbai, Kolkata and Chennai. Everywhere else the limit is 40% of salary.
Can I claim HRA under the new tax regime?
No. The HRA exemption is available only under the old tax regime.
What counts as salary for HRA?
Basic salary plus dearness allowance that forms part of retirement benefits.