There are three ways to calculate the HRA :-
1. Actual HRA received
2. If you are living in metropolitan city, it should be 50% of basic, otherwise 40% of basic component of your salary
3. If you are paying rent & you have rent receipt, you should calculate "Rent paid-10% of basic"
Now, HRA Exemption = Minimum return from the above three way calculation.
I hope it will fulfill your query.
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Example : HRA Recd - Rs. 100/- Rent Paid By You (livinging in Delhi)- Rs. 150/- , Basic Salary-Rs. 250/-
Least of following 3 is exempted
1. Actual HRA Recd. Rs.100/-
2. Rent Paid-10 % of SAL* (Rs. 150-10%X Rs. 250) Rs. 125/-
3. 50% of SAL* (50% X Rs. 250 ) Rs. 1250/-
Above 3 Point No. 1 Rs. 100/- is least
Taxable HRA - Actual Recd. - Exempted (100-100=0)
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