HRA Calculator
How much of your house rent allowance is tax-free in FY 2026-27 — with the new list of 8 metro cities — or what you can deduct for rent if your salary has no HRA.
How it works
The exemption comes from Schedule III, Table Sl. No. 11 of the Income-tax Act, 2025 (old section 10(13A)), with the limits in rule 279 of the Income-tax Rules, 2026(old rule 2A). It applies only to the months you actually rent a home you don't own. If your salary, HRA or rent changes during the year, work out each stretch separately and add them up — the rule uses the “relevant period”.
To see what the exemption does to your take-home, enter your rent in the in-hand salary calculator, or read HRA exemption, metro vs non-metro, worked through.
Sources & further reading
Section numbers are the Income-tax Act, 2025's, with the 1961 Act's in brackets.
Law and official notices
- Income-tax Act, 2025 (No. 30 of 2025) — Gazette of India, 21 Aug 2025, in force 1 Apr 2026
- Income-tax Rules, 2026 — G.S.R. 198(E) — Central Board of Direct Taxes, 20 Mar 2026
Frequently asked questions
Which cities count as metro for HRA from FY 2026-27?
Eight: Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru, at 50% of salary. Every other place is 40%. The last four were added by rule 279 of the Income-tax Rules, 2026 — before that, only the first four counted.
How is HRA exemption calculated?
It's the least of three amounts: the HRA you receive, rent paid minus 10% of salary, and 50% (8 metros) or 40% of salary, where salary means Basic plus DA if your terms provide for it. On ₹50,000 Basic, ₹25,000 HRA and ₹30,000 rent a month, ₹25,000 is exempt in one of the 8 metros but only ₹20,000 elsewhere, where the 40% cap is the smallest.
Can I claim HRA in the New Regime?
No. Section 202 of the Income-tax Act, 2025 takes away the HRA exemption and the rent deduction in the New Regime, where HRA is taxed like any other allowance. It only helps if the Old Regime works out cheaper for you overall.
Do I need my landlord's PAN?
Yes, if your rent for the year is over ₹1 lakh. Give your employer the landlord's name, address and PAN on Form No. 124 (rule 205) — the form that replaced Form 12BB — and your relationship to the landlord, if any.
Can I pay rent to my parents and claim HRA?
Yes, if you actually pay it and don't own the home yourself — the two conditions in the Act. Pay by bank transfer, keep a rent agreement, and remember the rent is your parent's taxable income. Form No. 124 now asks for your relationship to the landlord.
I pay rent but my salary has no HRA. Can I still save tax?
In the Old Regime, yes: section 134 (old 80GG) deducts the least of rent minus 10% of total income, ₹5,000 a month, and 25% of total income — unless you, your spouse or minor child own a home where you live or work.