Is Pune a metro city for HRA exemption?

Yes. Pune was added to the HRA metro list in Budget 2025 and qualifies as a metro city for HRA from FY 2026-27 onwards. The 50% of basic salary rate applies. For FY 2025-26 (current ITR filing year ending July 2026), Pune is still treated as non-metro at 40%.

Is Pune a metropolitan city as per income tax?

Under Section 10(13A) of the Income Tax Act, Pune is now classified as a metropolitan city for HRA purposes from FY 2026-27. Earlier, only Delhi, Mumbai, Kolkata and Chennai were metros. Budget 2025 added Pune, Bengaluru, Hyderabad and Ahmedabad to the list.

What HRA percentage applies in Pune?

From FY 2026-27, Pune employees can claim 50% of basic salary as HRA exemption (subject to the standard three-condition test). For FY 2025-26 the older 40% non-metro rate applies.

Does the metro classification cover Pimpri-Chinchwad and Hinjewadi?

Yes. Areas under Pune Municipal Corporation (PMC) and Pimpri-Chinchwad Municipal Corporation (PCMC) — including Hinjewadi, Wakad, Baner, Aundh, Kharadi, Magarpatta, Hadapsar — fall within the metro classification. Outlying rural panchayats not under PMC or PCMC follow the 40% non-metro rate.

Will the metro change increase my take-home pay?

Only if rent paid is high enough that the % of basic was the binding constraint earlier. For most Pune renters paying ₹15,000–25,000 monthly, the rent-minus-10% condition is binding, so the change does not affect exemption. Renters in premium areas with rent above 35-40% of basic will see a tangible increase.

Is Pune a Metro City for HRA? Yes — 50% Rate (Budget 2025)

Quick Answer

Yes — Pune is a metro city for HRA from FY 2026-27. The 50% of basic salary rate applies for HRA exemption under Section 10(13A).

Important transition: If you are filing the FY 2025-26 ITR (deadline 31 July 2026), the older 40% non-metro rate still applies because the change was notified in Budget 2025 effective FY 2026-27 onwards. The 50% rate only affects salary income earned from 1 April 2026.

What This Means for Your HRA Exemption

Worked example: an IT professional in Hinjewadi with ₹50,000 monthly basic salary, ₹25,000 HRA in their CTC, and ₹22,000 monthly rent.

Condition	FY 2025-26 (40%)	FY 2026-27 (50%)
1. Actual HRA received (annual)	₹3,00,000	₹3,00,000
2. Rent paid − 10% of basic	₹2,04,000	₹2,04,000
3. % of basic (Pune-specific)	₹2,40,000 (40%)	₹3,00,000 (50%)
HRA exempt (least of 3)	₹2,04,000	₹2,04,000

In this example the metro change does not increase the exemption because Condition 2 (rent − 10% of basic) is the binding constraint. The 50% metro rate only matters when rent is high enough that Condition 3 caps the exemption — typically when monthly rent crosses 35–40% of basic.

For a high-rent example: ₹50,000 basic, ₹25,000 HRA, ₹35,000 rent (premium 2BHK in Koregaon Park or Kalyani Nagar):

FY 2025-26 (40% non-metro): exemption capped at ₹2,40,000
FY 2026-27 (50% metro): exemption rises to ₹3,00,000 — that is ₹60,000 more deduction, worth ₹18,720 in tax saved at the 30% slab plus cess

The 8 Metro Cities for HRA (FY 2026-27)

Budget 2025 expanded the metro list from 4 to 8 cities, all eligible for the 50% HRA exemption rate:

Mumbai, Maharashtra
Delhi (NCT)
Kolkata, West Bengal
Chennai, Tamil Nadu
Bengaluru (Bangalore), Karnataka — added FY 2026-27
Hyderabad, Telangana — added FY 2026-27
Pune, Maharashtra — added FY 2026-27
Ahmedabad, Gujarat — added FY 2026-27

All other cities — including Noida, Gurgaon, Jaipur, Thane, Lucknow, Surat, Indore, Chandigarh, Nashik, Aurangabad — continue at the 40% non-metro rate.

Pune-Specific Notes

PMC and PCMC both qualify

Pune for HRA purposes covers both Pune Municipal Corporation (PMC) and Pimpri-Chinchwad Municipal Corporation (PCMC). The IT corridor (Hinjewadi, Wakad, Baner) sits in PCMC limits — these areas all qualify for the 50% metro rate.

Suburbs and rural Pune district

Areas in Pune district outside PMC/PCMC jurisdiction (Lonavala, Talegaon, Saswad, parts of Maval taluka) continue to be classified as non-metro at 40%. If you live in a rural panchayat but commute to a Pune office, the 40% rate applies to your HRA.

Mumbai vs Pune for HRA

If you have a choice between living in Mumbai (always metro) or Pune (metro from FY 2026-27), both now offer 50% HRA. Earlier this was a tax differentiator — it no longer is from April 2026.

How to Claim HRA in Pune

Rent receipts — monthly receipts signed by the landlord, with stamp if rent exceeds ₹3,000/month.
Rent agreement — registered if monthly rent is over ₹15,000 (Maharashtra registration rules apply).
Landlord PAN — mandatory if annual rent exceeds ₹1,00,000 (₹8,333/month). If landlord has no PAN, file Form 60 with employer.
Bank transfer proof — pay rent by NEFT/UPI, never cash. ITR scrutiny rejects cash-paid rent receipts almost automatically.
Form 12BB — submit to employer at the start of each financial year and update if rent changes.

Frequently Asked Questions

Is Pune a metro city for HRA right now?

It depends on which financial year you are calculating for. For HRA on FY 2026-27 salary (April 2026 onwards), Pune is metro at 50%. For FY 2025-26 ITR (filed July 2026), Pune is still non-metro at 40%.

Should I update my HRA declaration to my employer in Pune?

Yes — for FY 2026-27 declarations (made April–May 2026), recompute your projected HRA exemption with the 50% rate and update Form 12BB. Your employer will deduct lower TDS once they apply the higher exemption.

Does the metro change apply to old tax regime only or new regime too?

The metro reclassification applies to old tax regime only. The new tax regime does not allow HRA exemption at all. So this only matters if you have opted for the old regime for FY 2026-27.

Is Pimpri-Chinchwad covered under the Pune metro classification?

Yes. PCMC areas (Pimpri, Chinchwad, Akurdi, Nigdi, Bhosari, Hinjewadi) are part of the Pune metropolitan region for HRA purposes. The 50% rate applies from FY 2026-27.

What if I moved from Pune to Bangalore mid-year in FY 2026-27?

Both cities are now metros at 50%, so the rate stays the same. Calculate exemption month-by-month using actual rent paid in each city. Pune and Bangalore both qualify for 50% from FY 2026-27.

Calculate Your Exact Pune HRA Exemption

Enter your basic salary, HRA, and rent to see your annual HRA exemption with the new 50% metro rate.

Use HRA Calculator

Is Pune a Metro City for HRA? Yes — 50% Rate from FY 2026-27