HRA (House Rent Allowance)
A salary component for rent that can be partly tax-exempt in India.
What is HRA (House Rent Allowance)?
HRA (House Rent Allowance) is a component of salary paid by Indian employers to help cover rented accommodation, part of which can be exempt from income tax. The exempt amount is the least of the actual HRA received, rent paid above a set portion of salary, and a percentage of salary that differs for metro and non-metro cities. Claiming the exemption requires actually paying rent and is available under the old tax regime.