The PayHR HRA Calculator is an indispensable tool for employees, HR professionals, and payroll specialists to accurately calculate HRA exemptions. Whether your rent amount varies each month or you need to ensure precise calculations, this calculator is designed for you.
PayHR's Online HRA Calculator:
House Rent Allowance (HRA) is a monthly payment from employers to salaried individuals to cover rental expenses. A portion of this amount is tax-exempt, making it crucial for tax planning. If an employee owns a house and doesn't pay rent, the entire HRA amount is taxable.
The exemption on HRA is calculated based on Rule 2A of the Income Tax Rules, under Section 10(13A). The least of the following amounts is exempt:
1. Actual HRA received from employer
2. For those living in metro cities: 50% of (Basic salary + Dearness allowance)
For those living in non-metro cities: 40% of (Basic salary + Dearness allowance)
3. Actual rent paid minus 10% of (Basic salary + Dearness allowance)
1. Rent Receipts and Agreement: Submit copies of rent receipts and the rental agreement.
2. No Proof Required: For monthly rent up to Rs 3000/-.
3. Rent Receipts Required: For monthly rent between Rs 3000/- to Rs 8332/-.
4. Rent Receipts and Agreement with PAN: For monthly rent above Rs 8332/-.
5. Form 26QC: Required for rent above Rs 50000/- per month
6. Annual Submission: Submit proof to your employer by March each year or before the Full and Final (FnF) settlement if you exit the company.
To claim HRA while living with parents, have a rent agreement and transfer rent to your parents' bank account. Parents must declare this rent as income on their tax returns.
If your employer doesn't provide HRA, you can claim up to Rs 60,000/- under Section 80GG.
Yes, Individuals can claim both benefits together. A person is eligible to claim HRA exemption if he stays in rented accommodation. Simultaneously, if a person has taken a home loan from a financial institution then he can claim housing loan principal and interest benefits too. If he had bought a house with the help of a home loan and is living in another house on rent, then he can claim tax benefit for both. But if the house he bought and the house he lives is in the same city, then he should have a genuine reason for not living in the house that he owns, to prove to Income Tax Officer. The reason could be that the house he owns is too far from his workplace, or the commute is very difficult.
Yes, they can claim HRA exemption partially. To get this benefit the rent receipt and agreement should have both names. In rent agreement the amount of rent paid by both parties should be included.
This happens when the employee missed submitting rent proof to the employer, or the employee had not provided sufficient proof to the employer. In such a scenario employee can include the HRA exemption amount in his personal Income tax filing with the help of the PayHR HRA calculator.
