Dear All, Can anyone help me in understanding the HRA calculation? How much percent of HRA is exempt from Tax calculation. Regards, Gayatri
From India, Thana
1From India, Thana
Hi,
The actual HRA you will be entitled to will be the least of the following.
- The actual amount of HRA received.
- 40% of salary. This increases to 50% if you are renting out the house in Delhi Mumbai,Chennai or Kolkata
- Rent paid minus 10% of salary (basic component + dearness allowance)
The HRA that does not get exempted is taxed.
For example.
Assumptions
HRA per month = Rs 15,000
Basic monthly salary = Rs 30,000
Dearness Allowance = Nil
Monthly rent = Rs 12,000
Rental accommodation is in Mumbai.
Exemption
Actual amount of HRA = Rs 15,000
50% of salary = 50% x (30,000 + 0) = Rs 15,000
Actual rent paid - 10% of salary = Rs 12,000 - [10% of (30,000 + 0)] = 12,000 - 3,000 = Rs 9,000
Rs 9,000 being the least of the three amounts will be the exemption from HRA. The balance HRA of Rs 6,000 (15,000-Rs 9,000) is taxable
From India, Hyderabad
The actual HRA you will be entitled to will be the least of the following.
- The actual amount of HRA received.
- 40% of salary. This increases to 50% if you are renting out the house in Delhi Mumbai,Chennai or Kolkata
- Rent paid minus 10% of salary (basic component + dearness allowance)
The HRA that does not get exempted is taxed.
For example.
Assumptions
HRA per month = Rs 15,000
Basic monthly salary = Rs 30,000
Dearness Allowance = Nil
Monthly rent = Rs 12,000
Rental accommodation is in Mumbai.
Exemption
Actual amount of HRA = Rs 15,000
50% of salary = 50% x (30,000 + 0) = Rs 15,000
Actual rent paid - 10% of salary = Rs 12,000 - [10% of (30,000 + 0)] = 12,000 - 3,000 = Rs 9,000
Rs 9,000 being the least of the three amounts will be the exemption from HRA. The balance HRA of Rs 6,000 (15,000-Rs 9,000) is taxable
From India, Hyderabad
Dear Indu, You need to first register your self to the CiteHR, after you get login using your login and password, you will get the option to post new question below all post. Regards, Gayatri
From India, Thana
From India, Thana
Dear All Pls forward me the contact numbers of traning institutes or consultants for the pratical knowledge of ESI/PF/TDS etc. Thanking you. Regards Pragati
From India, Gurgaon
From India, Gurgaon
Dear All,
My salary is 30000 per month and paying 4000 rent per month.
Our company doesn't give us HRA or TA or DA, gives straight salary 30000.
So how my tax benefits will be calculated for HRA?
Thanks
From India, Panaji
My salary is 30000 per month and paying 4000 rent per month.
Our company doesn't give us HRA or TA or DA, gives straight salary 30000.
So how my tax benefits will be calculated for HRA?
Thanks
From India, Panaji
Hi Gayatri
HRA is max upto 50% of Basic in Metros & 40% in non-metros.
An illustration:
Your Basic - 10,000
In Metros, HRA allowed - 5000
Tax exempted = Rs.5000 (or actual rent paid, which ever is lower) minus 10% of your basic. i.e. Rs.4000/- per month is tax exempted (or actual rent paid minus 10% of basic if the rent is lesser than HRA permissible)
Similar way, HRA exemption for non-metros
Hope it clears your doubt
Regards
R.Ponraj
From India, Lucknow
HRA is max upto 50% of Basic in Metros & 40% in non-metros.
An illustration:
Your Basic - 10,000
In Metros, HRA allowed - 5000
Tax exempted = Rs.5000 (or actual rent paid, which ever is lower) minus 10% of your basic. i.e. Rs.4000/- per month is tax exempted (or actual rent paid minus 10% of basic if the rent is lesser than HRA permissible)
Similar way, HRA exemption for non-metros
Hope it clears your doubt
Regards
R.Ponraj
From India, Lucknow
Please take a look at the following blog post on calculating HRA exemption.
Calculation of HRA exemption – Part I TIBS Blog
From India, Madras
Calculation of HRA exemption – Part I TIBS Blog
From India, Madras
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