2 Replies
CA Srujann kumar Reddy
(Asst Manager(Internal audit))
(1679 Points)
Replied 09 March 2018
Tax exemption on HRA is least of the following:
1) Actual HRA received
2) Actual rent paid reduced by 10% of salary
3) 50% of basic salary if the taxpayer is living in a metro city
4) 40% of basic salary if the taxpayer is living in a non-metro city
Since the least of the above is exempt from tax, you can ask your employer to restructure your salary to get maximum tax benefit.
If all the factors mentioned above remain constant then tax exemption on HRA can be calculated annually but if any factor changes within the relevant Financial Year then calculation needs to be done on a monthly basis.
tamislocumb
(Accountant)
(22 Points)
Replied 13 March 2018
The amount paid to employee by the employer as a part of their salaries for residence is called House rent allowance (HRA). In the leading organizations employees are provided many facilities including HRA or especially where employees have to live abroad or out from house for long time due to job. There are many posts at https://marvelous-reviews.com/dissertation-editing-services/ and many other places on the internet. Government employees are also awarded with HRA. Thanks admin for sharing the rules of HRA really appreciated.
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