How to use this HRA calculator
Start with the year in which the salary relates. Match the monthly figures to your payslip and rental records, rather than entering annual totals into monthly fields. Keep DA separate from basic salary so you can check whether your employment terms qualify it. Enter commission only when your employment contract fixes it as a percentage of turnover achieved by you. A general incentive or discretionary bonus is not the same input.
Next, choose the location of the rented home and the number of months covered. Check that the displayed salary, rent and HRA totals match your records. If you joined employment partway through a year, calculate just the relevant period. If amounts changed, make a fresh calculation for each period and retain both copies. The toolkit version can combine two periods for you.
What the three limits mean
The old-regime exemption is limited to the smallest of the HRA received, rent above 10% of qualifying salary, and the applicable city percentage of salary. Negative rent excess is treated as zero. The balance of the allowance remains taxable. For the two earlier financial years, Chennai, Delhi, Mumbai and Kolkata use 50%; other places use 40%. See the Income Tax Department’s Rule 2A explanation.
From Tax Year 2026-27, Rule 279 adds Bengaluru, Hyderabad, Pune and Ahmedabad to the 50% list. The renamed reference is Schedule III, Table item 11 of the Income-tax Act, 2025, corresponding to former section 10(13A). The new-regime exclusion appears in section 202(2)(a)(i), corresponding to former section 115BAC. Sources: notified 2026 Rules, page 244 and section 202.
Using the result in your tax review
An exemption amount is a reduction in taxable income, not the amount of tax saved. Compare your complete income and eligible deductions before choosing a regime. Our old versus new regime guide explains that wider comparison. For help reconciling payslips and employer deductions, see our income-tax services. Keep a printed calculation with the supporting records and label each period clearly, particularly after a move or pay revision.
HRA questions
Can I claim HRA exemption in the new tax regime?
No. The new regime excludes HRA exemption. The calculator shows the full HRA received as taxable under that regime; this is not a calculation of your total income tax.
Does Bengaluru qualify for the 50% HRA salary limit?
Yes for Tax Year 2026-27 under Rule 279. Bengaluru, Hyderabad, Pune and Ahmedabad join Chennai, Delhi, Mumbai and Kolkata. For FY 2024-25 and FY 2025-26, Bengaluru uses the 40% limit.
What if my rent or salary changed during the year?
Calculate each period separately using the salary due, HRA received and rent for that period, then add the exemptions. Use the toolkit's two-period option for a mid-year change. Do not apply one city's rate to the whole year after moving.
Can I claim an exemption when I live in my own home?
HRA exemption is not available for living in your own home or accommodation for which you pay no rent. Untick the rented accommodation condition to see a zero exemption.