HRA Calculation : An important question in front of all the employed people is how can they save income tax. Most people do not know this, but House Rent Allowance (HRA) is exempted under the Income Tax Act, with the help of which you can also save tax. Today we will tell you about saving tax through HRA and will also tell you how HRA can be calculated and who gets HRA. Let's start without any delay.

Who can save through HRA?

Whether to give HRA or not depends on the company and only those who are given HRA by the company can get tax savings based on HRA. Before we tell you about tax savings from HRA, let us first tell you how much HRA is given to employees. In metro cities, 50% of the employee's basic earnings are given as HRA. Whereas in non-metro cities, the employee gets 40% of his basic earnings as HRA.

How to get tax exemption on HRA?

Under Income Tax Act Section 10 (13A), employees are given the option of tax savings under HRA. The employee is given tax exemption based on 50% of his basic income, HRA received, or rent amount after deducting 10% of the basic income from the remaining amount. Remember, whichever amount is the smallest among these three, you will get the tax exemption. Along with this, the employee should also keep in mind that the house or building for which he is paying rent should not be in his name.