Section 10(13A) · 3-condition formula · Metro 50% / Non-metro 40% · FY 2025-26
⚠️
Old Regime Only: HRA exemption under Section 10(13A) is available only if you opt for the Old Tax Regime. Under the new tax regime, HRA received from employer is fully taxable. If your HRA + other deductions justify it, choose old regime to save tax.
Salaried — Section 10(13A)
Self-employed — Section 80GG
Salary & HRA Details
₹10K₹40,000₹3L
₹0₹20,000₹2L
₹0₹18,000₹3L
50%
Metro City
Delhi · Mumbai · Kolkata · Chennai
40%
Non-Metro City
All other cities in India
💡 From FY 2026-27: Bengaluru, Pune, Hyderabad & Ahmedabad will also get 50% Metro rate
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🏠 Section 80GG — Rent Deduction for Self-Employed / No HRA
Section 80GG applies if: (1) You do NOT receive HRA, OR (2) You are self-employed / freelancer. Maximum deduction = lowest of 3 values. Available in Old Regime only.
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Section 80GG Deduction
₹0
Maximum rent deduction allowed per year
📊 80GG Calculation — Lowest of 3
Section 10(13A) — HRA Exempt for the Year
₹0
Minimum of 3 conditions · Annual
📊 3-Condition Formula — Section 10(13A) Breakdown
HRA exemption = Minimum of the following three amounts:
—
HRA Received
—
HRA Exempt
—
Taxable HRA
💰
Estimated Tax Saved on HRA Exemption
₹0
At 30% slab · Includes 4% cess
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HRA Claim Tips & Requirements
🏠 Keep all rent receipts with landlord's signature. If annual rent >₹1 lakh, you must provide landlord's PAN card to your employer.
📝 Submit rent agreement + receipts to HR by December/January to avoid excess TDS. If missed, claim while filing ITR.
📍 Claiming HRA but not paying rent? That's tax fraud. Both you and landlord are liable. Rent to parent is allowed — parent must show rental income in their ITR.
🏦 Rent exceeding ₹50,000/month: tenant must deduct TDS at 2% under Section 194IB before paying landlord.
⚡ Forgot to submit receipts to HR? You can still claim HRA exemption while filing ITR. Your employer may deduct full TDS — you'll get refund after filing.
📋 Quick Reference — HRA Exemption by Salary & Rent
Basic Salary
HRA (50%)
Rent Paid
Metro Exempt
Non-Metro Exempt
Assumes rent paid throughout year. Actual exemption may vary. Old regime only.
HRA Exemption Calculator India FY 2025-26 — Section 10(13A) Formula
House Rent Allowance (HRA) is one of the most valuable tax-saving components of a salaried person's salary structure. Under Section 10(13A) of the Income Tax Act, the HRA exemption is calculated as the minimum of three conditions: (1) Actual HRA received from employer, (2) Actual rent paid minus 10% of basic salary, and (3) 50% of basic salary for metro cities or 40% for non-metro cities. The exempted portion is deducted from taxable salary, reducing your income tax liability significantly. For a person in the 30% tax slab receiving ₹20,000 HRA/month and paying ₹18,000 rent in a metro city, the annual tax saving can be ₹60,000–₹75,000.
Metro vs Non-Metro Cities for HRA FY 2025-26
Currently (FY 2025-26), only 4 cities qualify for the 50% metro rate: Delhi, Mumbai, Kolkata, and Chennai. All other cities get 40%. From FY 2026-27, 4 more cities will be added to the metro list: Bengaluru, Pune, Hyderabad, and Ahmedabad — bringing the total to 8 cities at 50% HRA rate. This change benefits IT professionals and others in these cities significantly.
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❓ Frequently Asked Questions
What is the 3-condition rule for HRA exemption? ▾
Under Section 10(13A), HRA exemption = minimum of: (1) Actual HRA received from employer, (2) Rent paid minus 10% of basic salary (basic + DA forming part of salary), (3) 50% of basic salary (metro) or 40% (non-metro). Example: Basic ₹40K/mo, HRA ₹20K/mo, Rent ₹18K/mo, Metro city. Condition 1 = ₹2,40,000. Condition 2 = (₹18K–₹4K)×12 = ₹1,68,000. Condition 3 = ₹40K×50%×12 = ₹2,40,000. Minimum = ₹1,68,000 exempt.
Is HRA available in the new tax regime? ▾
No. HRA exemption under Section 10(13A) is only available in the old tax regime. Under the new tax regime (which is the default from FY 2023-24), HRA received is fully taxable as salary income. Before choosing a regime, calculate whether your total deductions (HRA + 80C + home loan + 80D) are large enough to justify paying higher rates in the old regime.
Which cities qualify for the 50% metro HRA rate? ▾
For FY 2025-26: Delhi, Mumbai, Kolkata, and Chennai are the 4 metro cities with 50% rate. All other cities get 40%. From FY 2026-27, 4 more cities will get 50%: Bengaluru, Pune, Hyderabad, and Ahmedabad — expanding the metro list to 8 cities. This change was announced to reflect the high cost of living in these IT and commercial hubs.
Can I claim HRA if I pay rent to my parents? ▾
Yes, rent to parents is fully valid for HRA claim. Requirements: (1) Have a proper rent agreement with your parent, (2) Pay rent via bank transfer (not cash above ₹20,000), (3) Your parent must declare the rent as income in their own ITR under House Property. Your parent can deduct 30% standard deduction and property tax from the rental income. This is a common and legitimate tax planning strategy.
What documents are needed to claim HRA? ▾
Monthly rent receipts (with ₹1 revenue stamp if paying cash above ₹5,000), rent agreement, and landlord's PAN card if annual rent exceeds ₹1 lakh. Submit to HR by January to ensure correct TDS deduction. If you miss submission, claim directly in ITR — the exemption is the same. Banks and post offices don't require receipts for ITR filing, but keep them for 6 years in case of scrutiny.
What is Section 80GG for self-employed people? ▾
Self-employed individuals and those who don't receive HRA can claim deduction under Section 80GG (old regime). The deduction = minimum of: (1) ₹5,000 per month (₹60,000 per year), (2) 25% of total annual income, (3) Annual rent paid minus 10% of total annual income. Conditions: You must not own a house in the city you live/work in, must not receive HRA from employer, and house should be for your own use.