HRA Tax Relief for ITR FY 25-26: Basic pay Rs 50,000; HRA Rs 15,000, and paying rent of Rs 12,500? Know how much tax benefit you may get this financial year

HRA Tax Relief for ITR FY 24-25: In the old tax regime, salaried-class individuals who receive house rent allowance (HRA) as part of their salary may claim tax benefits against the rent paid. But how will you know the maximum tax benefit you can claim? Will it be counted on the basis of the HRA you receive as part of your basic pay or the rent you pay? How is your tax benefit calculated?

What can be the maximum tax benefit if you are getting Rs 50,000 as basic pay that includes Rs 15,000 HRA, and you are paying Rs 12,500 monthly rent for your stay? See our calculations to know!

HRA tax benefit in old tax regime

An employee gets a house rent allowance (HRA) from their employer as part of their salary for the rent they are paying for their accommodation.

The HRA received is taxable, but a part of the HRA is tax exempt under Section 10(13A) of the Income Tax Act, 1961.

The tax benefit is applicable to old regime taxpayers, while new regime taxpayers get no such relief.

The tax benefit is different for taxpayers paying rent in metro cities such as Delhi, Kolkata, Mumbai, and Chennai, and taxpayers paying rent in other cities.

For old regime taxpayers, how is the HRA tax benefit calculated? 

HRA tax benefit calculations 

HRA will be the least of the three amounts- 

If you are staying in metro cities

Actual HRA received in year

50 per cent of basic pay

Rent paid- 10 per cent of salary

If you are staying in non-metro cities

Actual HRA received in year

40 per cent of basic pay

Rent paid- 10 per cent of salary  

Example of HRA tax benefit

A taxpayer is getting Rs 60,000 monthly basic pay, receiving Rs 15,000/month HRA, and paying Rs 17,000 a month as rent in a metro and a non-metro city. See how much tax benefit they may get.

When they are paying rent in a metro city

When they are paying rent in a non-metro city

Calculations for story

We are calculating the maximum HRA tax benefit a taxpayer can avail in the old tax regime if they have a basic monthly salary of Rs 50,000, get an HRA of Rs 15,000/month, and pay a rent of Rs 12,500/month.

We will calculate the tax benefit if the taxpayer is paying the rent in a metro and a non-metro city. 

Tax benefit (for metro city)

Tax benefit (for non-metro city)