House Rent Allowance Rules and Regulations – 7th CPC HRA – 7th Pay Commission HRA Rates – 7th CPC HRA Rules – HRA Exemption for Central Government employees

7th CPC House Rent Allowance for Central Government Employees

7th CPC HRA

House Rent Allowance or HRA is one of the major salary elements for Central Government employees. The 6th CPC recommended 10 percent of basic salary (Pay) for the employees working in other cities. And now the 7th pay commission recommended 8% of matrix pay for other cities. But the minimum amount of HRA is Rs. 1,800 (The minimum basic pay is Rs. 18,000 and the minimum HRA is equal to 10%).

House Rent Allowance (HRA) for CG Employees as per 7th CPC

The Government of India issued an important order regarding the rates and entitlements of House Rent Allowance for Central Government employees on 7.7.2017 as per the decision on 7th pay commission report. The new revised rates (percentage) of HRA as per city classification with effect from 1st July 2017 as follows…

X Class Cities: 24 percent of Basic Pay
Y Class Cities: 16 percent of Basic Pay
Z Class Cities: 8 percent of Basic Pay

Indian cities are classified according to the population for the purpose of House Rent Allowance (HRA) to Central Government Employees:

X Class Cities (Above 50 Lakh Population): 24% of Basic Salary
Y Class Cities (5 to 50 Lakh Population): 16% of Basic Salary
Z Class Cities (Below 5 Lakh Population): 8% of Basic Salary

Who is not entitled to HRA?
The employees who are residing in government accommodation are not an entitlement to HRA.

What is the meaning of Basic Pay?
The word of Basic Pay is used in the calculation purpose of HRA, does not include any type of pay like special pay, Non-Practising Allowance (NPA), Military Service Pay (MSP), etc.

Minimum HRA Rs. 1,800 at the rate of 10%

The revised rates of HRA will not be less than Rs.5400 for X Class cities, Rs. 3600 for Y Class cities and Rs. 1800 for Z class cities. The below table denotes the minimum amount of HRA for pay level 1, pay level 2 and for pay level 3.

HRA Calculation with minimum pay of all levels in 7th CPC Pay Matrix

Pay Matrix Level	Minimum Basic Salary (Pay)	HRA 24%	HRA 16%	HRA 8%
Pay Level 1	Rs. 18000	Rs. 5400	Rs. 3600	Rs. 1800
Pay Level 2	Rs. 19900	Rs. 5400	Rs. 3600	Rs. 1800
Pay Level 3	Rs. 21700	Rs. 5400	Rs. 3600	Rs. 1800

More than 7 lakh employees are benefiting due to the enhancement of minimum HRA and the table shows the basic pay in the pay level of 1, pay level 2 and pay level 3.

7th CPC Pay Matrix Level 1 (Grade Pay 1800)
Index	Basic Pay	HRA 8% (Z Class Cities)	HRA 16% (Y Class Cities)	HRA 24% (X Class Cities)
1	Rs. 18000	Rs. 1800	Rs. 3600	Rs. 5400
2	Rs. 18500	Rs. 1800	Rs. 3600	Rs. 5400
3	Rs. 19100	Rs. 1800	Rs. 3600	Rs. 5400
4	Rs. 19700	Rs. 1800	Rs. 3600	Rs. 5400
5	Rs. 20300	Rs. 1800	Rs. 3600	Rs. 5400
6	Rs. 20900	Rs. 1800	Rs. 3600	Rs. 5400
7	Rs. 21500	Rs. 1800	Rs. 3600	Rs. 5400
8	Rs. 22100	Rs. 1800	Rs. 3600	Rs. 5400

7th CPC Pay Matrix Level 2 (Grade Pay 1900)
Index	Basic Pay	HRA 8% (Z Class Cities)	HRA 16% (Y Class Cities)	HRA 24% (X Class Cities)
1	Rs. 19900	Rs. 1800	Rs. 3600	Rs. 5400
2	Rs. 20500	Rs. 1800	Rs. 3600	Rs. 5400
3	Rs. 21100	Rs. 1800	Rs. 3600	Rs. 5400
4	Rs. 21700	Rs. 1800	Rs. 3600	Rs. 5400
5	Rs. 22400	Rs. 1800	Rs. 3600	Rs. 5400

7th CPC Pay Matrix Level 3 (Grade Pay 2000)
Index	Basic Pay	HRA 8% (Z Class Cities)	HRA 16% (Y Class Cities)	HRA 24% (X Class Cities)
1	Rs. 21700	Rs. 1800	Rs. 3600	Rs. 5400
2	Rs. 22400	Rs. 1800	Rs. 3600	Rs. 5400

HRA will be revised to 30%, 20% & 10%

The rates of HRA will be revised to 27%, 18% and 9% for X, Y & Z class cities respectively when Dearness Allowance (DA) crosses 25 percent and further revised to 30%, 20% and 10% when DA crosses 50%.

Eligibility of HRA

The House Rent Allowance is admissible with reference to the place of office or duty. And it is not referenced with the residence of the employee.

CHECK ALSO: List of 7th Pay Commission Allowances

House Rent Allowance (HRA) is a compensation for expenses in connection with the rent of the residential accommodation to be hired or leased by the employee and is graded based on the level of the employee.

Classification of Cities for HRA after 7th Pay Commission

Indian cities are classified as three categories (X Cities, Y Cities and Z Cities) for the purpose of House Rent Allowance as per the population record. The ‘X’ Class and ‘Y” Class cities and towns are denoting in the below table as State wise and the other cities are under ‘Z’ Class.

State wise List of X Y Z Class Cities in India – Central Govt House Rent Allowance (HRA)

Andhra Pradesh & Telangana

Classified ‘X’ City (24% HRA)

Hyderabad (UA)

Classified ‘Y’ Cities (16% HRA)

Vijayawada (UA)
Warangal (UA)
Greater Visakahapatnam (M.Corpn.)
Guntur (UA)
Nellore (UA)

Assam

Classified ‘Y’ City (16% HRA)

Guwahati (UA)

Bihar

Classified ‘Y’ City (16% HRA)

Patna (UA)

Chandigarh

Classified ‘Y’ Cities (16% HRA)

Chandigarh (UA)
S.A.S. Nagar, Mohali*

Chhattisgarh

Classified ‘Y’ Cities (16% HRA)

Durg-Bhilai Nagar (UA)
Raipur (UA)

Delhi

Classified ‘X’ Cities (24% HRA)

Delhi(UA)

Gujarat

Classified ‘X’ Cities (24% HRA)

Ahmadabad (UA)

Classified ‘Y’ Cities (16% HRA)

Rajkot (UA)
Jamnagar (UA)
Bhavnagar (UA)
Vadodara (UA)
Surat (UA)

Haryana

Classified ‘Y’ Cities (16% HRA)

Faridabad* (M.Corpn.)
Gurgaon* (UA)

Jammu & Kashmir

Classified ‘Y’ Cities (16% HRA)

Srinagar (UA)
Jammu(UA)

Jharkhand

Classified ‘Y’ Cities (16% HRA)

Jamshedpur (UA)
Dhanbad (UA)
Ranchi (UA)
Bokaro Steel City (UA)

Karnataka

Classified ‘X’ Cities (24% HRA)

Bengalore / Bengaluru (UA)

Classified ‘Y’ Cities (16% HRA)

Belgaum (UA)
Hubli-Dharwad (M.Corpn.)
Mangalore (UA)
Mysore (UA)
Gulbarga (UA)

Kerala

Classified ‘Y’ Cities (16% HRA)

Kozhikoda (UA)
Kochi (UA)
Thiruvanathapuram (UA)
Thrissur (UA)
Malappuram (UA)
Kannur (UA)
Kollan (UA)

Madhya Pradesh

Classified ‘Y’ Cities (16% HRA)

Gwalior (UA)
Indore (UA)
Bhopal (UA)
Jabalpur (UA)
Ujjain (M.Corpn.)

Maharashtra

Classified ‘X’ Cities (24% HRA)

Greater Mumbai (UA)
Pune (UA)

Classified ‘Y’ Cities (16% HRA)

Amravati (M.Corpn.)
Nagpur (UA)
Aurangabad (UA)
Nashik (UA)
Bhiwandi (UA)
Solapur (M.Corpn.)
Kolhapur (UA)
Vasai–Virar City (M.Corpn.)
Malegaon (UA)
Nanded-waghala (M.Corpn.)
Sangli (UA)

Odisha

Classified ‘Y’ Cities (16% HRA)

Cuttack (UA)
Bhabaneswar (UA)
Raurkela (UA)

Puducherry (Pondicherry)

Classified ‘Y’ Cities (16% HRA)

Puducherry / Pondicherry (UA)

Punjab

Classified ‘Y’ Cities (16% HRA)

Amritsar (UA)
Jalandhar (UA)
Ludhiana (M.Coprn.)

Rajasthan

Classified ‘Y’ Cities (16% HRA)

Bikaner (M.Corpn.)
Jaipur (M.Corpn.)
Jodhpur (UA)
Kota (M.Corpn.)
Ajmer (UA)

Tamil Nadu

Classified ‘X’ Cities (24% HRA)

Chennai (UA)

Classified ‘Y’ Cities (16% HRA)

Salem (UA)
Tiruppur (UA)
Coimbatore (UA)
Tiruchirappalli (UA)
Madurai (UA)
Erode (UA)

Uttar Pradesh

Classified ‘Y’ Cities (16% HRA)

Moradabad (M.Corpn.)
Meerut (UA)
Ghaziabad* (UA)
Aligarh (UA)
Agra (UA)
Bareilly (UA)
Lucknow (UA)
Kanpur (UA)
Allahabad (UA)
Gorakhpur (UA)
Varanasi (UA)
Saharanpur (M.Corpn.)
Nodia* (CT)
Firozabad (NPP)
Jhansi (UA)

Uttarakhand

Classified ‘Y’ Cities (16% HRA)

Dehradun (UA)

West Bengal

Classified ‘X’ Cities (24% HRA)

Kolkata (UA)

Classified ‘Y’ Cities (16% HRA)

Asansol (UA)
Siliguri(UA)
Durgapur (UA)

Note:

S.A.S. Nagar, Mohali: Special sanction at par with Chandigarh
Faridabad, Gurgaon, Ghaziabad, Noida: Base on dependency only for HRA
Saharanpur: Classified as Y class with effect from June 2011

Which are classified Z cities in India?
Initially, the cities were classified as A B C and then categorized as X, Y and Z. The remaining cities and towns in India which are not covered by classification as X or Y are classified as Z class cities for the purpose of HRA to Central Government employees.

HRA Exemption from Income Tax

HRA Exemption Calculation and Calculator

A salaried employee can avail the benefit of exemption from Incoem Tax from his HRA (House Rent Allowance). As per the Income Tax Rules 10(13A) & Rule 2A House Rent Allowance least of the following is exempt

Actual HRA received in their salary slip
40% of Salary (Basic Pay + DA) for Non Metros
50% of Salary (Basic Pay + DA) for Metros (Mumbai, Calcutta, Delhi, Chennai)
Rent paid minus 10% of salary

If an employee is living in his own house or he does not pay any rent, he is not eligible for the above said exemption on HRA.

Latest News on HRA:

Admissibility of HRA in the event of non-acceptance or surrender of Railway Residential Accommodation March 13, 2020 Read more…
No Accommodation Certificate for Claiming House Rent Allowance February 14, 2020 Read more…
7th CPC HRA to PBOR of CAPF Personnel September 28, 2019 Read more…
Haryana Government employees to Get New HRA Rates as per 7th CPC at par with Central Government Employees August 28, 2019 Read more…
Revised rate of HRA to Haryana State Government employees as per 7th Pay Commission July 23, 2019 Read more…
7th CPC : Rates of HRA for Central Government Employees June 28, 2019 Read more…
Admissibility of House Rent Allowance (HRA) in the event of non-acceptance or surrender of railway residential accommodation April 5, 2019 Read more…
Dispensation of conditions of applying for Government Accommodation and furnishing of ‘No Accommodation Certificate’ for admissibility of House Rent Allowance March 25, 2019 Read more…
Finance Ministry Clarification on House Rent Allowance On 05th March 2019 March 6, 2019 Read more…
Abolition of Rent Free Accommodation Allowance – 7th CPC November 9, 2018 Read more…
Additional HRA To Railway Employees Serving In The States Of NER, AN, Lakshadweep Islands And Ladakh October 11, 2018 Read more…
Grant of Additional HRA to Central Govt Employees – Finmin Order 14.8.2018 August 16, 2018 Read more…
Admissibility of HRA in the event of non-acceptance or surrender of Railway Residential Accommodation-NFIR May 11, 2018 Read more…
Revised Rates of HRA for Karnataka Govt State Employees April 26, 2018 Read more…
Small Family Norms in House Building Advance Rules 2017 as per the recommendations of 7th CPC February 12, 2018 Read more…
Migration of Home Loan to Revised HBA – Ministry of Housing & Urban Affairs February 12, 2018 Read more…
Admissibility of HRA in the event of non-acceptance or surrender of railway residential accommodation January 26, 2018 Read more…
Are you satisfied you’re HRA? December 26, 2017 Read more…
7th CPC-House Rent Allowance New Order Issued December 20, 2017 Read more…
Admissibility of HRA during Study Leave – Railway Board Orders December 14, 2017 Read more…
House Rent Allowance to Defence Personnel December 14, 2017 Read more…
HRA Income Tax Exemption Calculator for Govt Employees November 25, 2017 Read more…
7th CPC-Additional HRA for Railway Employees November 16, 2017 Read more…
Report of the Committee on Allowances-House Rent Allowance (HRA) October 30, 2017 Read more…
Date of implementation of the allowances has created lot of anguish and serious discontentment in the CG Employees – NC JCM Secretary writes to Cabinet Secretary July 3, 2017 Read more…
Grant of House Rent Allowance to Railway employees posted to new Zones/new Divisions June 21, 2017 Read more…
7th CPC HRA – Justification for Retaining the Existing Rates of 10%, 20% and 30% May 13, 2017 Read more…
Grant of HRA to Railway employees May 12, 2017 Read more…
Issue of Admissibility of House Rent Allowance – Railway Board Orders March 18, 2017 Read more…
Grant of HRA at Chandigarh rates to CG Employees Posted at S.A.S. Nagar Mohali February 7, 2017 Read more…
Admissibility of HRA in case of residing in Govt. Guest House / Transit Facility – CGDA Orders January 9, 2017 Read more…
HRA should be paid @ 35, 25 and 15% of pay – BPMS November 28, 2016 Read more…
Admissibility of House Rent Allowance in the event of non-acceptance or surrender of railway residential accommodation August 3, 2016 Read more…
7th Pay Commission – Central Government To Soon Hike HRA August 3, 2016 Read more…
7th Pay Commission HRA and other allowances need be revised at the earliest – Confederation July 29, 2016 Read more…
Percentage of HRA in 7th pay commission after cabinet approval June 30, 2016 Read more…
Grant of House Rent Allowance to Railway Employees posted to new zones/new divisions June 17, 2016 Read more…
New form to claim tax rebate on LTA, HRA May 8, 2016 Read more…
Grant of HRA at a higher rate (“B” Category) to the Central Government Servants Posted at Aizawl (Mizoram) – Court Case regarding March 16, 2016 Read more…
House Rent Paid : 80GG has also been raised to 60,000 from 24,000 per annum March 1, 2016 Read more…
7th CPC recommendations on Pay Scale, MACP, HRA, TA, LTC, FMA – Views of Indian Audit & Accounts Department February 23, 2016 Read more…
Issues related to House Rent Allowance : Views of Indian Audit & Accounts Department February 23, 2016 Read more…
Grant of House Rent Allowance to Railway employees posted to new Zones/new Divisions February 21, 2016 Read more…
Denial of payment of HRA, Transport Allowance etc. to trainees appointed on compassionate ground in Grade Pay 1900/- in artisan category December 30, 2015 Read more…
7th Pay Commission Analysis and Recommendations on House Rent Allowance December 18, 2015 Read more…
7th CPC recommendations to reduce House Rent Allowance November 23, 2015 Read more…
Seventh Pay Commission Report Chapter 8.7: Allowances related to Housing (CILQ,HRA, FAA, Family HRA, Hutting Allowance, Rent Free Accommodation, SNLQ) November 22, 2015 Read more…
HRA as per Census 2011 to Railway Employees – Orders issued October 2, 2015 Read more…
Denial of payment of HOUSE RENT ALLOWANCE, Transport Allowance etc. to trainees appointed on compassionate ground September 30, 2015 Read more…
Grant of 30% HRA to staff working Umdanagar, Medchal and Gundlapochampally on par with the staff working in GHMC limits September 22, 2015 Read more…