How to Calculate HRA Tax Exemption For AY 2025-26?

Mitali | Last updated: 08 September 2025

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House Rent Allowance (HRA) is a key part of many salary packages, offering tax deductions under Section 10(13A) of the Income Tax Act. To claim HRA exemption, you must be a salaried employee living in a rented house and have HRA included in your CTC. The exemption is calculated as the lowest of three amounts: actual HRA received, a percentage of salary (50% for metro cities, 40% for non-metro), or actual rent paid minus 10% of salary. Note that HRA exemption is only available under the old tax regime.

HRA full form stands for House Rent Allowance is one of the major components of most salary packages. It is most important for calculations to ascertain how much of the HRA can be claimed to get deductions under Section 10(13A) of the Income Tax Act. What is HRA - House Rent Allowance? House

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About the Author

Mitali

Finance Professional

I write about Income Tax, GST, TDS, RBI updates, government schemes, and personal finance in India. My focus is on simplifying complex tax and compliance topics into easy-to-understand guides that help readers stay updated with the latest financial rules, investment options, and regulatory changes.

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