Table of Contents
What is rent paid 10 basic?
The actual rent that is paid should be less than 10\% of the basic salary. In case you’re staying in a metro, 50\% of the basic salary and 40\% if you live in a a non-metro city. The actual amount received as the HRA from the employer.
How is basic and HRA calculated?
HRA received from your employer. Actual rent paid minus 10\% of salary. 50\% of basic salary for those living in metro cities. 40\% of basic salary for those living in non-metro cities.
Is HRA always 50 of basic salary?
HRA Deduction The salary or pay for individuals can be defined as the sum of their basic salary, DA (dearness allowance), and any/all other commissions as applicable. HRA deduction calculation for employees residing in a metro will be 50\% of the basic salary and is 40\% for residence in a non-metro city.
Is HRA exemption calculated monthly or yearly?
In other words, the year is divided into as many periods as dictated by changes in any of the input parameters, and HRA exemption is calculated for each of the periods.
What is the HRA tax exemption amount for rent paid?
Rs 60, 000 (@Rs 5000 Per Month, according to the HRA exemption 2016-17 rules, earlier the limit was Rs 2, 000) Rent paid i.e. 1.5 Lakhs – 10\% of the total annual income, i.e. Rs 40, 000= Rs 1, 10, 000 As the least of the three is Rs 40, 000, this would be the HRA tax exemption provided to Mr. Sohan, and the 1st condition will prevail.
How do you calculate HRA on rent?
HRA paid to the employee = Rs 25,000 x 10.5 months (on account of loss of pay) = Rs 262,500. c. Rent paid by the employee for the year = Rs 25,000 x 12 = Rs 300,000. HRA exemption calculation. 1. Rent paid in excess of 10\% of Basic salary = Rs 300,000 – Rs 52,500 = Rs 247,500.
What is the maximum amount I can claim on my HRA?
HRA can’t be more than 50\% of your basic salary The full amount cannot be claimed as the exemption is based on the least of the following: Actual rent paid (-) 10\% of the basic salary. Actual HRA received from the employer
What is the HRA exemption period for period 2?
Period 2: From August 1 to September 15 – when Basic pay and HRA change (became zero) on account of loss of pay. Period 3: From September 16 to March 31 – when there is no change to any of the input factors. HRA exemption for period 1– from April 1 to July 31 = Rs 80,000. HRA exemption for period 2 — from August 1 to September 15 = Rs 0.