PERQUISITES

PERQUISITES

Perquisites are the benefits or amenities in cash or in money and also amenities which are not convertible into money. Provided by the employer to the employee whether free of cost or at a concessional rate.

Perquisites are taxable under the head “salaries”. A perquisites,to be taxable under the head. salaries,must fulfill the following conditions.

1. Perquisitesmust be provided by the employer directly or

indirectly to the employee or to any member of his household reson of his employment.

2. Perquisites must directly be related with the

employment

Type of perquisites

perquisites

General perquisites

Specific perquisites

Taxe-freeperquisites

3.tax-free perquisites

1. Medical facilities; free medical facilities provided by bthe employer to an

employee reimbursement of actual medical expenses such as cost of medicines,tests ,hospitalization charges,operation fees,etc

2.Recreation facilities; Recreation facilities provided to group of employee,not being

restricted to selected few employees,are exempt from tax .but if such facility is provided to a particular employee seperately ,it would be a specific perquisites taxable in the hand of specific employee.

3.Conference; any expenditure incurrect by the employyer for an employee in

connection with a conference,such as conveyance, tour and

travel, hotel expenditur or doarding and lodging expenses, 4.Tour and travel facility; any conveyance, tour and travel(including foreign travel)

facility provided by the employer to an employee is exempt perquisites in the hand of the employee.

5.Refreshment facility; refreshment(tea or sncks)provided to all employees

during working hours in office premises is exempt from tax.

6.Conveyance facility; transport or conveyance provided by an employer to his

employee from his residence to office and from office to his residence, is also regarded as tax-free perquisites.

7.Telephone or mobile phone facility; telephone or mobile phone provided by the employer to

an employee at his residence whose bill is also paid by employer.is regarded as tax-free perquisites even throuh the telephone or mobile phon is used by the employee for his personal purposes.

8.Lunch or dinner; lunch or dinner provided to an employee during working

or business hours or through paid non-transferable voucher is exempt perquisite

9.Interest free loan; any loan provided by the employer to an employee either

free of intrest or at concessional rate of intrest, is taxe-free perquisite,if the amount of loan does not exceed Rs.20,000.