House Rent Allowance Online Calculator

HOUSE RENT ALLOWANCE (HRA) CALCULATOR

House rent allowance also known as HRA is an essential part of your salary. All employers have to offer House rent allowance as repayment for house rental expenses. Many people does not know the fact that we can also save tax on it. Based on factors like the employee’s salary structures and the city in which they live in, the House rent allowance amount is decided. If you are an employee who receives salary and is living in a rented place, then you can calculate your tax responsibilities using our House rent allowance calculator.

What is an House Rent Allowance Calculator?

In most of the Indian cities, the cost and expenses of living has risen considerably due to an increase in expendable income besides inflation. Many of the companies or organizations provide house rent allowance to their employees who lives in a rented house. This is done to ensure the welfare of their employees. This House Rent Allowance calculator helps you in discovering the amount you will receive as an allowance.

The House Rent Allowance across India have been changed to a considerable extent, after the recommendation of the 7th Pay Commission. The cities are now been divided into 3 distinct slabs. Slab X covers the most urban cities where you definitely need an House Rent Allowance exemption calculator. Slab Y includes the slightly low cost cities.

How can an House Rent Allowance Calculator Help You?

All the individuals who receive a housing rental allowance from their employer, can use the house rent allowance calculator for their benefit.

These are the 3 conditions on which you can claim an exemption under House Rent Allowance:

• House Rent Alllowance (HRA) must be a part of the salary you receive. You are not eligible to use this calculator if you are a self-employed person.
• You must live in a rented house.
• The House Rent Allowance has to exceed 10 per cent of your salary.

House Rent Allowance calculator can be used tocompute the amount of tax you have to pay on your House Rent Allowance.

There are several other advantages:

• Based on the city where you live in you can declare House Rent Allowance on the calculated amounts. Slab X cities are expensive to live in than the cost of cities covering Slab Y and Z.
• House rent allowance exemption calculator helps to determine the amount of tax you have to pay in a financial year.
• House rent allowance also depend on the city or the place you reside.

Example, if you reside in Delhi, Ahmedabad, Hyderabad, Mumbai or Chennai the House rent allowance may rise to 27%. The figure may decrease to 19% and 8% for the slab Y and Z cities.

• Depending on the amount of your salary granted as House rent allowance you can easily plan for the better future using our House rent allowance calculator.

How to Calculate HRA or House Rent Allowance in India?

We use a standard formula to find out the total House Rent Allowance to be paid. When it comes ro House rent allowance calculations, our calculator works as an great house rent allowance tax benefit calculator. The definite exemption limit will be the lowest of the 3 main heads below.

• Total (verified) rent paid minus 10% basic salary for every person.
• Total (gross) house rent allowance that the employer offers to the employee.
• Based on the budget of the residential conditions, 40 to 50% of the basic salary.

We can use  an example of a man named Ravi to identify the house rent allowance to be paid. If he resides in Mumbai at rented premises for which he has to pay Rs 12,000 every month then the following will be his pay structure based on our house rent allowance calculator.

Summing up all the figures we identify that the Ravi has a monthly pay of Rs 44,500.

Depending on the three heads mentioned earlier and by using our House Rent allowance calculator, the figures are:

• The Actual rent paid by the person minus 10% basic or Rs 9700
• House Rent Allowance the employer offers is 15000
• 50% of the base salary is Rs 11,500

As the least of these 3 sums is calculated as house rent allowance, Ravi has to pay Rs 9700 as House Rent Allowance. It will be removed from his taxable income.

How to Use the HRA or House Rent Allowance Calculator?

This calculator is easy to use, you simply have to follow the below mentioned steps –

Step 1: Input your base salary and House Rent Allowance you get as per your salary slip.

Step 2: Input the rent paid and identify whether you live in a metro city or a low cost city.

Benefits of using an House Rent Allowance calculator.

The primary advantages are:

• The calculator is error free. You can use it multiple times.
• You can maintain tax dispensation based on the calculations.
• The calculator takes care of all the figures which are part of the House Rent Allowance calculation.