House Rent Allowance
House Rent Allowance [sec.10 (13A)]
HRA is exempt to the extent of least of the following amount
1) Actual HRA received,
2)Excess of rent paid over 10 % of salary,
3.1)50 % of salary, if the accommodation is situated in Mumbai, Kolkata, Chennai or Delhi,
3.2)40 % of salary is the accommodation is situated in any other place.
Here, salary includes basic Salary, DA if given under the terms of employment and commission based on fixed per cent
Note: if the employee is living in his own house and is getting HRA or living in a house for which he is not paying any rent ,
total amount of HRA is Taxable.
Excess of rent paid over 10 % of salary means Rent paid-10 % of Salary