House Rent Allowance (HRA) Calculator

HRA exemption is calculated as the least of:

• Actual HRA received from employer
• 50% of basic salary for metro cities (40% for non-metro)
• Actual rent paid minus 10% of basic salary
• Different rates apply based on city classification
• Calculation done on monthly/yearly basis

Required documentation includes:

• Rent receipts or rent agreement
• Landlord's PAN (if rent > ₹1 lakh annually)
• Form 12BB from employer
• Proof of house rent payment
• Declaration from landlord if required

City classification for HRA:

• Metro cities: Delhi, Mumbai, Chennai, Kolkata
• Metro rate: 50% of basic salary
• Non-metro cities: All other cities
• Non-metro rate: 40% of basic salary
• Classification based on population density

Rules for claiming HRA with parents:

• Cannot claim if house owned by self
• Can claim if paying rent to parents
• Proper rent agreement needed
• Parents must show rental income in tax returns
• All payment proof must be maintained

HRA claims for house owners:

• Can claim if rented house is in different city
• Valid if owned house is rented out
• Must declare rental income from owned house
• Need proper documentation for both properties
• Subject to scrutiny by tax authorities

Alternative documentation options:

• Bank statements showing rent payment
• Registered rent agreement
• Letter from landlord
• Declaration from employer
• Digital payment proofs acceptable