| S.No. | Particulars | Benefits | |
|---|---|---|---|
| 1 | Rent free unfurnished accommodation provided to Central and State Government employees U/S 17(2)(i) | License Fees determined in accordance with rules framed by Government for allotment of houses shall be deemed to be the taxable value of perquisites. | |
| 2 | Unfurnished rent free accommodation provided to other employees U/S 17(2)(i)/(ii) (Use Calculator to Perquisite Value If House Property is taken on lease for Income Tax ) | Taxable value of perquisites | |
| A. If House Property is owned by the employer: | |||
| i. 15% of salary, if population of city where accommodation is provided exceeds 25 lakhs as per 2001 census | |||
| ii. 10% of salary, if population of city where accommodation is provided exceeds 10 lakhs but does not exceed 25 lakhs as per 2001 census | |||
| iii. 7.5% of salary, if accommodation is provided in any other city | |||
| B. If House Property is taken on lease or rent by the employer, the perquisite value shall be : | |||
| i. Lease rent paid or payable by the employer or 15% of the salary, whichever is lower | |||
| *Salary includes: | |||
| a) Basic Pay | |||
| b) Dearness Allowance (only to the extent it forms part of retirement benefit salary) | |||
| c) Bonus | |||
| d) Commission | |||
| e) All other allowances (only taxable portion) | |||
| f) Any monetary payment which is chargeable to tax | |||
| But does not include | |||
| i. Value of any perquisite [under section 17(2)] | |||
| ii. Employer's contribution to PF | |||
| iii. Benefits received at the time of retirement like gratuity, pension etc. | |||
| Note: | |||
| 1) Rent free accommodation is not chargeable to tax if provided to an employee working at mining site or an on-shore oil exploration site, etc., - | |||
| (i) which is being of temporary nature (subject to conditions) | |||
| (ii) which is located in remote area. | |||
| 2) Rent free accommodation if provided to High Court or Supreme Court Judges, Union Ministers, Leader of Opposition in Parliament, an official in Parliament and Serving Chairman and members of UPSC is Tax Free Perquisites. | |||
| 3) The value so determined shall be reduced by the amount of rent, if any, paid by the employee. | |||
| 4) If employee is transferred and retain property at both the places, the taxable value of perquisites for initial period of 90 days shall be determined with reference to only one accommodation (at the option of the assessee). The other one will be tax free. However after 90 days, taxable value of perquisites shall be charged with reference to both the accommodations. | |||
| | |||
| 3 | Rent free furnished accommodation U/S 17(2)(i) | Taxable value of perquisites | |
| a) Find out taxable value of perquisite assuming accommodation to be provided to the employee is unfurnished | |||
| b) Add: 10% of original cost of furniture and fixtures (if these are owned by the employer) or actual higher charges paid or payable (if these are taken on rent by the employer). | |||
| Note: The value so determined shall be reduced by the amount of rent, if any, paid by the employee | |||
| 4 | A furnished accommodation in a Hotel U/S 17(2)(i) | Taxable value of perquisites | |
| Value of perquisite shall be lower of following: | |||
| a) Actual charges paid or payable by the employer to such hotel | |||
| b) 24% of salary | |||
| Note: Hotel accommodation will not be chargeable to tax if : | |||
| a) It is provided for a total period not exceeding in aggregate 15 days in the financial year; and | |||
| b) Such accommodation in hotel is provided on employee's transfer from one place to another place. | |||
| 5 | Motor Car / Other Conveyance U/S 17(2)(iii) | Taxable value of perquisites | |
| Rule 3(2) | |||
| 6 | Services of a domestic servant including sweeper, gardener, watchmen or personal attendant U/S 17(2)(iii) | Taxable value of perquisite shall be salary paid or payable by the employer for such services less any amount recovered from the employee. | |
| (Taxable in case of specified employee only [See Note ])Rule 3(3) | |||
| 7 | Supply of gas, electricity or water for household purposes U/S 17(2)(iii) | Taxable value of perquisites: | |
| 1. Manufacturing cost per unit incurred by the employer., if provided from resources owned by the employer; | |||
| 2. Amount paid by the employer, if purchased by the employer from outside agency | |||
| Note: | |||
| i. )Any amount recovered from the employee shall be deducted from the taxable value of perquisite. | |||
| ii. )Taxable in case of specified employees only [See note ] | |||
| 8 | Education Facilities U/S 17(2)(iii) | Taxable value of perquisites | |
| 9 | Transport facilities provided by the employer engaged in carriage of passenger or goods (except Airlines or Railways) U/S 17(2)(iii) | Value at which services are offered by the employer to the public lessamount recovered from the employee shall be a taxable perquisite | |
| (Taxable in case of specified employee only [See Note ])Rule 3(6) | |||
| 10 | Amount payable by the employer to effect an insurance on life of employee or to effect a contract for an annuity U/S 17(2)(v) | Fully Taxable | |
| 11 | ESOP/ Sweat Equity Shares U/S 17(2)(vi)read withRule 3(8) | Taxable value of perquisites | |
| Fair Market value of shares or securities on the date of exercise of option by the assessee less amount recovered from the employee in respect of such shares shall be the taxable value of perquisites. | |||
| Fair Market Value shall be determined as follows: | |||
| a) In case of listed Shares: Average of opening and closing price as on date of exercise of option (Subject to certain conditions and circumstances) | |||
| b) In case of unlisted shares/ security other than equity shares: Value determined by a Merchant Banker as on date of exercise of option or an earlier date, not being a date which is more than 180 days earlier than the date of exercise of the option. | |||
| 12 | Employer's contribution towards superannuation fund U/S 17(2)(vii) | Taxable in the hands of employee to the extent such contribution exceed Rs.1,00,000 | |
| 13 | Interest free loan or Loan at concessional rate of interest U/S 17(2) | Interest free loan or loan at concessional rate of interest given by an employer to the employee (or any member of his household) is a perquisite chargeable to tax in the hands of all employees on following basis: | |
| 1. Find out the 'maximum outstanding monthly balance' (i.e. the aggregate outstanding balance for each loan as on the last day of each month); | |||
| 2. Find out rate of interest charged by the SBI as on the first day of relevant previous year in respect of loan for the same purpose advanced by it; | |||
| 3. Calculate interest for each month of the previous year on the outstanding amount (mentioned in point 1) at the rate of interest (given in point 2) | |||
| 4. Interest actually recovered, if any, from employee | |||
| 5. The balance amount (point 3-point 4) is taxable value of perquisite | |||
| Nothing is taxable if: | |||
| a) Loan in aggregate does not exceed Rs 20,000 | |||
| b) Loan is provided for treatment of specified diseases (Rule 3A) like neurological diseases, Cancer, AIDS, Chronic renal failure, Hemophilia (specified diseases). However, exemption is not applicable to so much of the loan as has been reimbursed to the employee under any medical insurance scheme. | |||
| 14 | Facility of travelling, touring and accommodation availed of by the employee or any member of his household for any holiday U/S 17(2)(viii) | a) Perquisite value taxable in the hands of employee shall be expenditure incurred by the employer less amount recovered from employee. | |
| b) Where such facility is maintained by the employer, and is not available uniformly to all employees, the value of benefit shall be taken to be the value at which such facilities are offered by other agencies to the public less amount recovered from employee. | |||
| 15 | Free food and beverages provided to the employee U/S 17(2)(viii) | 1) Fully Taxable: Free meals in excess of Rs. 50 per meal less amount paid by the employee shall be a taxable perquisite | |
| 2) Exempt from tax: Following free meals shall be exempt from tax | |||
| a) Food and non-alcoholic beverages provided during working hours in remote area or in an offshore installation; | |||
| b) Tea, Coffee or Non-Alcoholic beverages and Snacks during working hours are tax free perquisites; | |||
| c) Food in office premises or through non-transferable paid vouchers usable only at eating joints provided by an employer is not taxable, if cost to the employer is Rs. 50(or less) per meal. | |||
| 16 | Gift or Voucher or Coupon on ceremonial occasions or otherwise provided to the employee U/S 17(2)(viii) | a) Gifts in cash or convertible into money (like gift cheque) are fully taxable | |
| b) Gift in kind up to Rs.5,000 in aggregate per annum would be exempt, beyond which it would be taxable. | |||
| 17 | Credit Card U/S 17(2)(viii) | a) Expenditure incurred by the employer in respect of credit card used by the employee or any member of his household less amount recovered from the employee is a taxable perquisite | |
| b) Expenses incurred for official purposes shall not be a taxable perquisite provided complete details in respect of such expenditure are maintained by the employer | |||
| 18 | Free Recreation/ Club Facilities U/S 17(2)(viii) | a) Expenditure incurred by the employer towards annual or periodical fee etc. (excluding initial fee to acquire corporate membership)less amount recovered from the employee is a taxable perquisite | |
| b) Expenses incurred on club facilities for the official purposes are exempt from tax. | |||
| c) Use of health club, sports and similar facilities provided uniformly to all employees shall be exempt from tax. | |||
| 19 | Use of movable assets of the employer by the employee is a taxable perquisite U/S 17(2)(viii) | Taxable value of perquisites | |
| a) Use of Laptops and Computers: Nil | |||
| b) Movable asset other than Laptops, computers and Motor Car*: 10% of original cost of the asset (if asset is owned by the employer) or actual higher charges incurred by the employer (if asset is taken on rent) less amount recovered from employee. | |||
| for computation of perquisite value in case of use of the Motor Car | |||
| 20 | Transfer of movable assets by an employer to its employee U/S 17(2)(viii) | Taxable value of perquisites | |
| a) Computers, Laptop and Electronics items: Actual cost of asset lessdepreciation at 50% (using reducing balance method) for each completed year of usage by employer less amount recovered from the employee | |||
| b) Motor Car: Actual cost of asset less depreciation at 20% (using reducing balance method) for each completed year of usage by employer less amount recovered from the employee | |||
| c) Other movable assets: Actual cost of asset less depreciation at 10% (on SLM basis) for each completed year of usage by employer less amount recovered from the employee. | |||
| 21 | Any other benefit or amenity extended by employer to employee U/S 17(2)(viii) | Taxable value of perquisite shall be computed on the basis of cost to the employer (under an arm's length transaction) less amount recovered from the employee. | |
| However expenses on telephones including a mobile phone incurred by the employer on behalf of employee shall not be treated as taxable perquisite. | |||
| 22 | Tax paid by the employer on perquisites (not provided for by way of monetary payments) given to employee U/S 10(10CC) | Fully exempt | |
| 23 | Leave Travel Concession or Assistance (LTC/LTA), extended by an employer to an employee for going anywhere in India along with his family* U/S 10(5) | The exemption shall be limited to fare for going anywhere in India along with family twice in a block of four years: | |
| *Family includes spouse, children and dependent brother/sister/parents. However, family doesn't include more than 2 children of an Individual born on or after 01-10-1998. U/S | i. Exemption limit where journey is performed by Air - Air fare of economy class in the National Carrier by the shortest route or the amount spent, whichever is less | ||
| ii. Exemption limit where journey is performed by Rail - Air-conditioned first class rail fare by the shortest route or the amount spent, whichever is less | |||
| iii. Exemption limit if places of origin of journey and destination are connected by rail but the journey is performed by any other mode of transport - Air-conditioned first class rail fare by the shortest route or the amount spent, whichever is less | |||
| iv. Exemption limit where the places of origin of journey and destination are not connected by rail: | |||
| a. Where a recognized public transport system exists - First Class or deluxe class fare by the shortest route or the amount spent, whichever is less | |||
| b. Where no recognized public transport system exists - Air conditioned first class rail fare by shortest route or the amount spent, whichever is less | |||
| Notes: | |||
| i. Two journeys in a block of 4 calendar years is exempt | |||
| ii. Taxable only in case of Specified Employees [See note ] | |||
| 24 | Medical facilities in India U/S Proviso to section 17(2) | 1) Expense incurred or reimbursed by the employer for the medical treatment of the employee or his family (spouse and children, dependent - parents, brothers and sisters) in any of the following hospital is not chargeable to tax in the hands of the employee: | |
| a) Hospital maintained by the employer. | |||
| b) Hospital maintained by the Government or Local Authority or any other hospital approved by Central Government | |||
| c) Hospital approved by the Chief Commissioner having regard to the prescribed guidelines for treatment of the prescribed diseases. | |||
| 2) Medical insurance premium paid or reimbursed by the employer is not chargeable to tax. | |||
| 3) Any other expenditure incurred or reimbursed by the employer for providing medical facility in India is not chargeable to tax up to Rs. 15,000 in aggregate per assessment year. | |||
| 25 | Medical facilities outside India U/S Proviso to section 17(2) | Any expenditure incurred or reimbursed by the employer for medical treatment of the employee or his family member outside India is exempt to the extent of following (subject to certain condition): | |
| a) Expenses on medical treatment - exempt to the extent permitted by RBI. | |||
| b) Expenses on stay abroad for patient and one attendant - exempt to the extent permitted by RBI. | |||
| c) Cost on travel of the employee or any family or one attendant - exempt, if Gross Total Income (before including the travel expenditure) of the employee, does not exceed Rs. 2,00,000. | |||
Note
The following employees are deemed as specified employees:
1) A director-employee
2) An employee who has substantial interest (i.e. beneficial owner of equity shares carrying 20% or more voting power) in the employer-company
3) An employee whose monetary income* under the salary exceeds Rs. 50,000
*Monetary Income means Income chargeable under the salary but excluding perquisite value of all non-monetary perquisites