a) Salary shall be determined on due basis for the period for which the employee occupies rented accommodation in the previous year and gets HRA. b) Exemption is not available if employee lives in his own house, or in a house for which he does not pay any rent c) For criteria of 50% or 40% of salary as deduction, place of employment is not significant but place where the house is situated is important d) Deduction from HRA depends on Salary of the employee, Amount of HRA, place of residence (not place of employment), rent paid by the employee. uuent of Ajmer, receives 48,000 as basic salary during the previous year 2018-19. In addition, he gets 4.800 as dearness allowance forming part of basic salary, 7% commission on sales made by him (sale made by X during the relevant previous year is 86,000) and 6,000 as house rent allowance He, however, pays 5,800 as house rent Determine the quantum of exempted house rent allowance. Computation of taxable house rent allowance of X for the AY. 2019-20 Particulars Details (C) Amount () 6,000 6,000 House Rent Allowance Received Less: Minimum of the following being exempted u/s 10(13A) a) Actual Amount Received b) 40% of Salary (Note) c) Rent paid - 10% of salary R 5,800 - 5,882] Taxable House Rent Allowance 23.528 Nil NI 6,000 Note: Salary for the purpose of HRA Basic Basic salary 48,000 Dearness Allowance 4,800 Commission (7% of 86,000) 6,020 Total 58,820 Hence, exemption u/s 10(13A) IS NII f15 ILLUSTRATION 9 Compute the taxable house rent allowance of Mr. Abhijeet from the following data: Basic Salary 5,000 p.m., DA 2,000 p.m., HRA 4,000 p.m., Rent paid 4,000 p.m in Pune. On 1/07/2018, there is an increment in Basic salary by 1,000 . On 1/10/2018, employee hired a new flat in Kolkata at the same rent as he was posted to Kolkata On 1/01/2019, employee purchased his own flat and resides there