Perquisite Tax

[S.C. WADHWA]

Dear Expert,

One of our director getting salary ₹50000/- Per month from a unit in delhi which provided him unfurnished rent free accommodation and also getting salary from other unit ₹500000/- per month.  Perquisite tax on rent free accommodation along with electricity bill of ₹600000/- per year will be paid by Ist unit.

Now my query is whether perquisite tax paid on electricity bills being monetary payments is exempt in the hand of employee or not.  Please quote some circular or case law in this issue.

Regards,

WADHWA

 

 

[Mayank Srivastava]

Dear Mr. Wadhwa,

 

Tax Paid only on RFA can be exempted, as it considered as a non monetary perks.

 

Regards,

Mayank

AI Summary

Perquisite tax treatment: employer paid utilities are monetary perquisites and not exempt; rent free accommodation may be non monetary. Issue: whether perquisite tax on employer paid electricity for an employee occupying unfurnished rent free accommodation is exempt. Answer: only the perquisite attributable to the rent free accommodation is treated as a non monetary perquisite for exemption; employer payments for utilities that are monetary perquisites are not eligible for that exemption.