Question

Mr. Akash is a salaried employee working in

Delhi. He gives the following details:

Salary Rs. 20,000/- p.m ; DA(forming part)

Rs. 10,000/-p.m; HRA Rs.8,000/-p.m[rent

paid by him Rs. 10,000/- p.m]. Calculate exempted HRA​

Answer 1

Given : Mr. Akash is a salaried employee working in  Delhi.

Salary Rs. 20,000/- p.m ;

DA Rs. 10,000/-p.m;

HRA Rs.8,000/-p.m

[rent  paid by him Rs. 10,000/- p.m].

To Find : Calculate exempted HRA​

Solution:

BASIC  = 20000

DA   = 10000

HRA  = 8000

Rent Paid  = 10000

HRA Exemption is minimum of 3 cases

40 % of Basic  or Basic + DA ( Non Metro City)

50 % of Basic or Basic + DA  (  Metro City)  

He lived in delhi - Metro city and DA is forming Part hence added to BAsic

Hence

50 % of Basic + DA   = (50/100) (20000 + 10000) = 15000

Rent Paid  - 10% of Basic + DA   = 10000  - (10/100)(20000+ 10000) = 7000

HRA  Received = 8000

Minimum of Three = 7000

exempted HRA​ =7000

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Answer 2

Answer:

Salary - ( 20,000*12 month) 2,40,000

DA - (10,000*12) 1,20,000

So, Basic salary = Salary + DA

2,40,000+1,20,000 = 3,60,000

HRA exempted minimum of three case.

1. Actual HRA = (8000*12) 96,000

2. ( Delhi is metropolitan city) 50% of salary = (3,60,000*50%) 1,80,000

3. Rent paid - 10% of salary

= ((10,000*12) - (3,60,000*10%))

= (1,20,000 - 36,000)

= 84,000

HRA exempted is minimum value of three case is 84,000

Taxable HRA = Actual HRA - exempted HRA

= 96,000 - 84,000

= 12,000

So, Taxable HRA is 12,000