HRA exemption when we shift from non metro to metro location

Dear sir, In our tax worksheet provided by my employer, HRA exempted amount is calculated considering as non metro location though I have shifted from nonmetro to metro in the month of june.This can increase my taxable income.when asked them about the same,they are unable to understand the issue and it seems it is autocalculated by the system they prepared.If they can not reolve this by jan 31st,same would get printed in form-16 and tax will be decucted accordingly. 1) What is the calculation for this.Whether we should consider as metro or non metro or pro rata basis ? 2)If it can be considered as metro or prorata calculation,can i claim the difference by filing ITR after i receive my form-16 (as any way figures would be different in ITR from the form16 )? Pls help !!! thank you in anticipation

asked Jan 19 '15 at 19:44 by sai mukehsh 12


In case you moved to metro city in June, your HRA exemption should be computed on that basis only starting from June.

HRA exemption is computed on a monthly basis and not on yearly basis. So in between year if you change metro to non-metro (or vice versa) or rent is changed, then HRA exemption would also be recomputed starting from that month.

HRA exemption should be done by employer only and there is no option of mentioning it in ITR form. But if employer does not do it, you would have no option but to show reduced taxable income in ITR (different from form-16)

answered Jan 25 '15 at 08:39 by Pankaj Batra 5.2k320

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Asked: Jan 19 '15 at 19:44

Seen: 1,448 times

Last updated: Jan 25 '15 at 08:39