Understanding DA: Is It Part of HRA and How Does It Affect Taxes in Metro Cities?

Is DA an Additional Component of HRA?
Is DA an additional component of HRA?

Percentage of DA in Metro Cities
What is the percentage of DA in metro cities?

Role of DA in Tax
What is the role of DA in tax?

D.A. is not an additional component of HRA. It is a component of your salary meant to neutralize the effect of the cost of living on your basic pay so that it will not be eroded against rising inflation. However, D.A., in my view, is treated as part of income for tax purposes.

Regards,
B. Saikumar
HR & Labour Law Consultant
Chipinbiz Consultancy Pvt. Ltd
Mumbai
Tel: [Phone Number Removed For Privacy Reasons]