HRA For Salaried Individuals
Under Section 10 (13A), in accordance with Rule 2A of the Income Tax Act, individuals receiving a salary have the provision to seek exemptions on their House Rent Allowance (HRA).
The amount of HRA exemption that can be claimed depends on:-
- The actual HRA received from the employer,
- Rent paid by the employee for the accommodation,
- Salary received by the employee, and
- The city where the employee resides (classified into metro and non-metro cities).
What is House Rent Allowance, HRA Exemption And Tax Deduction
House Rent Allowance(HRA) is a component of the salary provided by employers to employees to meet the cost of renting a house or accommodation. It is a common practice in many countries, including India, where HRA is a popular component of the salary structure. HRA is beneficial for both employees and employers as it helps employees manage their housing expenses, and employers can provide a tax-free allowance instead of providing company-owned accommodation.
In this article, we will discuss what HRA is, what HRA is for self-employed and salaried individuals, how to claim HRA exemption, and how to calculate HRA exemption.
What is House Rent Allowance, HRA Exemption, Rules & Tax Deductions