# HRA (House Rent Allowance) & How is HRA Calculated?

**URL:** <https://community.greythr.com/t/hra-house-rent-allowance-how-is-hra-calculated/287>\
**Category:** Income Tax\
**Created:** [June 16, 2020, 6:34am UTC](https://community.greythr.com/t/hra-house-rent-allowance-how-is-hra-calculated/287 "2020-06-16T06:34:42Z")\
**Posts on this page:** 3\
**Page:** 1

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**Author:** ![SantoshK](https://avatars.discourse-cdn.com/v4/letter/s/58956e/32.png) [@SantoshK](https://community.greythr.com/u/SantoshK)\
**Post date:** [June 16, 2020, 6:34am UTC](https://community.greythr.com/t/hra-house-rent-allowance-how-is-hra-calculated/287/1 "2020-06-16T06:34:42Z")

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We know HRA (House Rent Allowance) is a salary component. How is HRA Calculated?

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**Author:** ![vgulvady](https://avatars.discourse-cdn.com/v4/letter/v/e47c2d/32.png) [@vgulvady](https://community.greythr.com/u/vgulvady)\
**Post date:** [June 16, 2020, 1:34pm UTC](https://community.greythr.com/t/hra-house-rent-allowance-how-is-hra-calculated/287/2 "2020-06-16T13:34:27Z")

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Hi Adarsh,  
If you are asking specifically on how much HRA can be paid to an employee, then the computation is very simple. Ascertain if the employee is staying in a rented house in any of these four metro cities, i.e. Delhi, Mumbai, Kolkata or Chennai. If yes, then the employee can avail HRA of 50% of basic salary. For any other cities or towns, the HRA is at 40% of basic salary.  
Trust this helps.

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**Author:** ![SantoshK](https://avatars.discourse-cdn.com/v4/letter/s/58956e/32.png) [@SantoshK](https://community.greythr.com/u/SantoshK)\
**Post date:** [June 18, 2020, 1:26pm UTC](https://community.greythr.com/t/hra-house-rent-allowance-how-is-hra-calculated/287/3 "2020-06-18T13:26:14Z")

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Thank you Vinod @vgulvady !