Company car sale of exiting exployee will taxable

[udit gupta]

What will be income tax If company sold a car to company employee who is leaving company Regards Narendra

AI Summary

Income Tax on Employee Car Purchase: Calculate Perquisite Tax with 20% Depreciation Using WDV Method. A query was raised regarding the income tax implications when a company sells a car to an employee who is leaving the company. The response clarified that the taxable amount as a perquisite for the employee would be calculated by taking the car's original cost to the company, subtracting 20% depreciation for each completed year using the Written Down Value (WDV) method, and then subtracting the consideration received. If the resulting difference is positive, it is taxable.