Metro vs. Non-Metro HRA Tax Calculator
Living in Bengaluru or Hyderabad and paying high rent? Learn why your city is classified as Non-Metro under the 1962 tax statute, and calculate your exact HRA tax exemption.
The Statutory Section 10(13A) 3-Condition Test
Your tax-free HRA is strictly the lowest of the following three values:
The actual HRA allowance paid by your employer across 12 months.
Total annual rent paid by you minus 10% of your annual Basic Salary.
50% of Basic for Delhi/Mumbai/Kolkata/Chennai; 40% for all other cities.
Bengaluru (40%) vs. Mumbai (50%) Tax Exemption Scenarios
| Compensation Profile | Annual Rent Paid | Mumbai Exemption (50%) | Bengaluru Exemption (40%) | Net Tax Difference |
|---|---|---|---|---|
| ₹15 LPA CTC (Basic ₹7.5L = ₹62.5k/mo) | ₹30,000/mo (₹3.6L/yr) | ₹2.85 Lakhs (50% rule) | ₹2.85 Lakhs (Rent - 10% rule binds) | Same exemption (rent capped) |
| ₹20 LPA CTC (Basic ₹10.0L = ₹83.3k/mo) | ₹45,000/mo (₹5.4L/yr) | ₹4.40 Lakhs (Rent - 10% basic) | ₹4.00 Lakhs (40% ceiling binds) | ₹40,000 lower exemption in Bangalore (~₹12.4k extra tax) |
| ₹30 LPA CTC (Basic ₹15.0L = ₹1.25L/mo) | ₹60,000/mo (₹7.2L/yr) | ₹5.70 Lakhs (Rent - 10% basic) | ₹5.70 Lakhs (40% ceiling = ₹6.0L) | Equal exemption |
| ₹35 LPA CTC (Basic ₹17.5L = ₹1.45L/mo) | ₹75,000/mo (₹9.0L/yr) | ₹7.25 Lakhs (Rent - 10% basic) | ₹7.00 Lakhs (40% ceiling binds) | ₹25,000 lower exemption in Bangalore (~₹7.8k extra tax) |
Calculate Your HRA Tax Exemption
Switch between Metro (50%) and Non-Metro (40%) and enter your rent to see instant Old Regime tax changes.
Estimated monthly credit in bank under NEW Tax Regime (FY 2025-26).
Annual CTC distribution
NEW Tax RegimeTax Comparison (New vs. Old Regime)
Budget 2024 revised slabs vs. Old Regime deductions for ₹₹15,00,000 CTC
New Tax Regime
FY 25-26Old Tax Regime
TraditionalFrequently Asked Questions: Metro vs. Non-Metro HRA
Clear answers to common questions on CTC structure, take-home calculations, Budget 2024 tax slabs, and Section 87A rebate rules.
Why are Bengaluru, Hyderabad, and Pune classified as 'Non-Metro' for HRA exemption?
Under Rule 2A of the Income Tax Rules, 1962, the definition of 'Metro Cities' for the 50% HRA exemption ceiling was permanently codified to include only the four original colonial presidency metros: New Delhi, Mumbai, Kolkata, and Chennai. Despite repeated representations by Indian IT professionals and industry bodies (NASSCOM), Rule 2A has never been amended by Parliament, leaving Bengaluru, Hyderabad, Gurugram, Noida, and Pune categorized as Non-Metro (capped at 40% of Basic Salary).
Can I claim HRA exemption under the New Tax Regime (Section 115BAC)?
No. HRA exemption under Section 10(13A) is strictly unavailable under the New Tax Regime. Under the New Regime, you receive an increased flat ₹75,000 Standard Deduction with zero paperwork or rent receipts required. You must opt into the Old Tax Regime to claim HRA exemptions.
When is my landlord's PAN mandatory for claiming HRA?
Under CBDT circulars, if your annual rent paid exceeds ₹1,00,000 per financial year (more than ~₹8,333/month), it is mandatory to provide your landlord's Permanent Account Number (PAN) to your employer HR. If the landlord does not have a PAN, a signed declaration in Form 60 must be submitted.
Can I pay rent to my parents and claim HRA?
Yes, provided legitimate financial transactions occur. The property must be legally registered in your parents' names, rent must be transferred via bank account transfers (NEFT/UPI), genuine rent receipts must be maintained, and your parents must report this rental income in their annual Income Tax Returns (ITR).