Yes, if you actually pay them rent (bank transfer) and they declare it as income. A rent agreement and receipts are advisable.
HRA Calculator
Enter your basic salary, the HRA you receive and the rent you pay to get the exact exemption under Section 10(13A) — the least of the three statutory limits — with metro vs non-metro rules and a worked example.
HRA exempt (annual)
₹1,56,000
HRA taxable (annual)
₹84,000
Exempt per month
₹13,000
Tax saved at 30% slab (approx.)
₹48,672
The three limits — exemption is the lowest
| Rule | Monthly | Annual |
|---|---|---|
| Actual HRA received | ₹20,000 | ₹2,40,000 |
| 50% of basic + DA | ₹25,000 | ₹3,00,000 |
| Rent paid − 10% of basic + DA | ₹13,000 | ₹1,56,000 |
- Available only under the old tax regime. Rent above ₹1 lakh a year requires the landlord's PAN.
How the HRA Calculator works
Section 10(13A) exempts the least of: the HRA actually received; 50% of basic + DA if you live in Delhi, Mumbai, Kolkata or Chennai (40% elsewhere); and rent paid minus 10% of basic + DA.
Because the third rule subtracts 10% of salary, a small rent relative to salary can produce zero exemption. Calculate for each period separately if your rent or city changed during the year.
Exemption = min( HRA received, 50%/40% × (Basic + DA), Rent − 10% × (Basic + DA) )
Worked example
- Basic salary (monthly): ₹50,000
- HRA received (monthly): ₹20,000
- Rent paid (monthly): ₹18,000
- City: Metro (Delhi, Mumbai, Kolkata, Chennai)
Basic ₹50,000, HRA ₹20,000, rent ₹18,000 in a metro: the limits are ₹20,000, ₹25,000 and ₹13,000 (18,000 − 5,000). The exemption is ₹13,000 a month — ₹1,56,000 a year — and the remaining ₹7,000 a month of HRA is taxed.