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HRA Calculator: Maximize Your Tax Savings with House Rent Allowance
Complete guide to HRA tax exemption calculation. Learn how to claim maximum HRA benefits and save thousands in taxes with practical examples and strategies.
3 November 2025
6 min read
House Rent Allowance (HRA) is one of the most commonly used tax-saving components in Indian salary structures. If you're paying rent, you can claim significant tax exemptions that could save you thousands of rupees annually.
💰 HRA Exemption Formula
Exemption = Minimum of:
• Actual HRA received
• Actual rent paid - 10% of basic salary
• 50% of basic salary (metro) or 40% (non-metro)
HRA Calculation Examples: Real Scenarios
Example 1: IT Professional in Bangalore (Metro)
Salary Details:
- • Basic Salary: ₹40,000/month
- • HRA Received: ₹20,000/month
- • Rent Paid: ₹25,000/month
- • City: Bangalore (Metro)
HRA Exemption Calculation:
Actual HRA:₹20,000
Rent - 10% Basic:₹21,000
50% of Basic:₹20,000
Exemption (Minimum):₹20,000
Example 2: Manager in Pune (Non-Metro)
Salary Details:
- • Basic Salary: ₹50,000/month
- • HRA Received: ₹15,000/month
- • Rent Paid: ₹18,000/month
- • City: Pune (Non-Metro)
HRA Exemption Calculation:
Actual HRA:₹15,000
Rent - 10% Basic:₹13,000
40% of Basic:₹20,000
Exemption (Minimum):₹13,000
HRA Documentation Requirements
✅ Required Documents
- • Rent receipts with revenue stamp (if rent > ₹1L/year)
- • Rental agreement copy
- • Landlord's PAN card (if rent > ₹1L/month)
- • Bank statements showing rent payments
- • Form 12BB submission to employer
❌ Common Mistakes
- • Not getting rent receipts with revenue stamps
- • Missing landlord's PAN for high rent
- • Claiming HRA while owning property in same city
- • Not submitting documents on time
- • Incorrect rent receipt format
Calculate Your HRA Tax Savings
Use our HRA calculator to maximize your tax benefits and save thousands annually.
Tags
HRATax SavingHouse RentTax ExemptionSalary Structure
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