Treatment of HRA in Income Tax Return

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Jaswinder (Querist)
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26 July 2010 How to calculate the exempt amount of HRA if the salary is Rs.263755/- and HRA Rs.54000/- is included in salary

CA. Pradeep Nayak

CA. Pradeep Nayak (Expert)
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26 July 2010 As per Sec 10(13A), exempt HRA shall be the least of the following:
1. Excess of rent paid over 10% of Basic Salary (total rent paid - 10% of basic)
2. 40% of Basic (50% in case the rented accomodation is in a metro city)
3. Actual HRA received.

Jaswinder

Jaswinder (Querist)
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26 July 2010 Thanks Sir,
What would be the exempt amount in the said case

CA. Pradeep Nayak

CA. Pradeep Nayak (Expert)
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26 July 2010 What is the basic salary & actual rent paid?

Jaswinder

Jaswinder (Querist)
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26 July 2010 Basic Salary is Rs.9300/- and i have paid Rs.42000/- as rent

CA. Pradeep Nayak

CA. Pradeep Nayak (Expert)
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26 July 2010 As per Sec 10(13A), exempt HRA shall be the least of the following:
1. Excess of rent paid over 10% of Basic Salary (Rs. 42,000 - (Rs. 9,300 X 12 X 10%)) = Rs. 30,840
2. 40% of Basic (50% in case the rented accomodation is in a metro city)Rs. 44,640
3. Actual HRA received. Rs. 54,000

So, Rs. 30,840/- will be exempt.

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