How to Compute HRA Exemption?

Question

Income Tax

Answer 1

For HRA deduction read this

http://mytaxes.in/index.php?topic=17.0

Answer 2

You may consult your Income Tax Advisor / Consultant or C.A. who will let you know this information, ofcourse, with professional fees.

Answer 3

HRA which stands for House rent Allowance comes under the head salary and exemption under this is provided as lower of the following amounts as per section  10(13A) and rule2A:

a.)actual amt. of HRA received

b.)rent paid in excess OF 10% OF SALARY of the period for which HRA is received i.e. rent paid less 10% of salary

c.)50% of the salary of the period for which HRA is rec. in case of metro cities and 40% in case of other places.

the exemption  will be available in the foll. cases ;

1.Salary for this purpose includes salary for retirement benefits i.e. basic salary,D.A. for retirement benefits and commission rec. on sales

2.No exemption shall be available if rent is not paid /incurred or rent amt. is less than 10% of salary income.