Clause 13A of section 10 ?

Section 10(13A) HRA Exemption Limit

Section 10(13A) of the Income Tax Act provides for Exemption on HRA. The Income Tax Act exempts a part of HRA under section 10(13A) read with 2A, with some specific conditions. Any special allowance specifically granted to an employee by his employer to meet expenditure actually incurred on payment of rent in respect of residential accommodation occupied by the assessee, is exempt to the extent of least of the following:

1. Actual amount of such allowance received in respect of the relevant period
2. Rent paid over 10% of salary [Rent paid – 10% of salary
3. an amount equal to 50% (where such accommodation is situated at Mumbai, Kolkatta, Delhi or Chennai) or 40% (where such accommodation is situated at any other place) of Salary.

Salary Definition – Section 10(13A) Income Tax Act

Salary = Basic Pay + D.A. (If form part of retirement benefit) + Commission (If it is based on specific % of turnover).