List of benefits available to Salaried Persons for A.Y. 2015–2016

10(13A) & Rule 2A)

a) Actu­al HRA Received

b) 40% of Salary (50%, if house sit­u­at­ed in

Mum­bai, Cal­cut­ta, Del­hi or Madras)

c) Rent paid minus 10% of salary

* Salary= Basic + DA (if part of retire­ment benefit)

+ Turnover based Commission

Note:

i. Ful­ly Tax­able, if HRA is received by an

employ­ee who is liv­ing in his own house or if

he does not pay any rent

ii. It is manda­to­ry for employ­ee to report PAN

of the land­lord to the employ­er if rent paid is

more than Rs. 1,00,000 [Cir­cu­lar No. 08

/2013 dat­ed 10th Octo­ber, 2013].

max­i­mum of 2 chil­dren is exempt

max­i­mum of 2 chil­dren is exempt

employ­ee is not in receipt of dai­ly allowance.

a)      70% of such allowance; or

b)      Rs. 10,000 per month.

in per­for­mance of duties of an office

out­side India

Court/Supreme Court (Sub­ject to cer­tain conditions)

a) Val­ue of rent free offi­cial residence

b) Val­ue of con­veyance facil­i­ties includ­ing trans­port allowance

c) Sump­tu­ary allowance

d) Leave trav­el concession

(Sub­ject to cer­tain conditions)

The val­ue of res­i­den­tial tele­phone free of cost and the num­ber of free calls to the extent of 1500 per month shall be exempt.

(h) Bihar (i) Orissa

Allowance. If this exemp­tion is tak­en, employ­ee can­not claim any exemp­tion in respect of bor­der area allowance (Sub­ject to certain

con­di­tions and locations)

Allowance. If this exemp­tion is tak­en, employ­ee can­not claim any exemp­tion in respect of bor­der area

allowance (Sub­ject to certain

con­di­tions and locations)

their per­ma­nent loca­tions. If this exemp­tion is tak­en, employ­ee can­not claim any exemp­tion in respect of

bor­der area allowance (Sub­ject to cer­tain con­di­tions and locations)

con­di­tions and locations)

b) Up to Rs. 1,600 per month (for alti­tude above 15,000 feet)

loca­tions)

loca­tions)

read with

Rule 3(1)

accom­mo­da­tion pro­vid­ed to Cen­tral and State Gov­ern­ment employees

(i)/(ii)

read with

Rule 3(1)

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

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.

read with

Rule 3(1)

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

read with

Rule 3(1)

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.

read with

Rule 3(2)

below)

read with

Rule 3(3)

includ­ing sweep­er, gardener,

watch­men or per­son­al attendant

read with

Rule 3(4)

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.

j. Tax­able in case of spec­i­fied employ­ees only [See note 4]

read with

Rule 3(5)

below)

read with

Rule 3(6)

employ­ee or to effect a con­tract for an annuity

read with

Rule 3(8)

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.

read with

Rule 3(7)

(i)

con­ces­sion­al rate of interest

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.

read with

Rule 3(7)

(ii)

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.

read with

Rule 3(7)

(iii)

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.

read with

Rule 3(7)

(iv)

cer­e­mo­ni­al occa­sions or oth­er­wise pro­vid­ed to the employee

b) Gift in kind up to Rs.5,000 in aggre­gate per annum would be exempt, beyond which it would be taxable.

read with

Rule 3(7)

(v)

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

read with

Rule 3(7)

(vi)

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.

read with

Rule 3(7)

(vii)

employ­er by the employ­ee is a

tax­able perquisite

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.

*See Note 1 for com­pu­ta­tion of perquisite val­ue in case of use of the Motor Car

read with

Rule 3(7)

(viii)

a) Com­put­ers, Lap­top and Elec­tron­ics items:

Actu­al cost of asset less depre­ci­a­tion 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.

read with

Rule 3(7)

(ix)

extend­ed by employ­er to employee

How­ev­er expens­es on tele­phones includ­ing a mobile phone incurred by the employ­er on behalf of employ­ee shall not be treat­ed as tax­able perquisite.

perquisites (not pro­vid­ed for by way of mon­e­tary pay­ments) giv­en to employee

Assis­tance (LTC/LTA), extend­ed by an employ­er to an employ­ee for going any­where in India along with his family*

*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.

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 4]

17(2)

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.

sec­tion

17(2)

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.

a) Rs 5,000

b) 1/5th of salary (exclud­ing any allowance, ben­e­fits or oth­er perquisite)

c) Actu­al enter­tain­ment allowance received

a) Amount actu­al­ly received

b) Unuti­lized earned leave* X Aver­age monthly

salary

c) 10 months Aver­age Salary**

d) Rs. 3,00,000

*While com­put­ing unuti­lized earned leave, earned leave enti­tle­ments can­not exceed 30 days for each year of ser­vice ren­dered to the cur­rent employer

**Aver­age salary = Aver­age Salary*** of last 10 months imme­di­ate­ly pre­ced­ing the retirement

***Salary = Basic Pay + Dear­ness Allowance (to the extent it forms part of retire­ment ben­e­fits)+ turnover based commission

received by a work­man under the Indus­tri­al Dis­pute Act, 1947(Subject to cer­tain conditions).

a) an amount cal­cu­lat­ed as per sec­tion 25F(b)of the Indus­tri­al Dis­putes Act, 1947;

b) Rs. 5,00,000; or

c) Amount actu­al­ly received

Note:

i. Relief under Sec­tion 89(1) is available

ii. 15 days aver­age pay for each com­plet­ed year of con­tin­u­ous ser­vice or any part there­of in excess of 6 months is to be adopt­ed under sec­tion 25F(b) of the Indus­tri­al Dis­putes Act, 1947.

statu­to­ry corporations)

(oth­er than Gov­ern­ment employ­ee) (Sub­ject to cer­tain conditions).

1. (*15/26) X Last drawn salary** X completed

year of ser­vice or part there­of in excess of 6 months.

2. Rs. 10,00,000

3. Gra­tu­ity actu­al­ly received.

*7 days in case of employ­ee of seasonal

estab­lish­ment.

** Salary = Last drawn salary includ­ing DA but exclud­ing any bonus, com­mis­sion, HRA, over­time and any oth­er allowance, ben­e­fits or perquisite

1972 (oth­er than Government

employ­ee) (Sub­ject to certain

con­di­tions).

1. Half month’s Aver­age Salary* X Com­plet­ed years of service

2. Rs. 10,00,000

3. Gra­tu­ity actu­al­ly received.

*Aver­age salary = Aver­age Salary of last 10 months imme­di­ate­ly pre­ced­ing the month of retirement

** Salary = Basic Pay + Dear­ness Allowance (to the extent it forms part of retire­ment ben­e­fits)+ turnover based commission

(i)

Employ­ees and Statutory

Cor­po­ra­tion

(ii)

(iii)

(Sub­ject to cer­tain conditions)

1) Actu­al amount received as per the guide­lines i.e. least of the following

a) 3 months salary for each com­plet­ed year of services

b) Salary at the time of retire­ment X No. of months of ser­vices left for retire­ment; or

2) Rs. 5,00,000

gra­tu­itous­ly or by way of

com­pen­sa­tion or oth­er­wise to wid­ow or oth­er legal heirs of an employ­ee who dies while still in active ser­vice [Cir­cu­lar No. 573, dat­ed 21–08- 1990]

duty [Cir­cu­lar No. 776, dat­ed 08- 06–1999]

trade rep­re­sen­ta­tion of a for­eign state

a) For­eign enter­prise is not

engaged in any trade or busi­ness in India

b) His stay in India does not

exceed in aggre­gate a period

of 90 days in such previous

year

c) Such remu­ner­a­tion is not liable to deduct­ed from the income of employ­er charge­able under this Act

does not exceed 90 days in the

pre­vi­ous year.

mem­ber state (Sub­ject to cer­tain conditions).

1. Motor Car (tax­able only in case of spec­i­fied employ­ees [See note 4] except when car owned by the

employ­ee is used by him or mem­bers of his house­hold whol­ly for per­son­al pur­pos­es and for which

reim­burse­ment is made by the employer)

No.

(val­ue of perquisite )

cc (val­ue of perquisite)

reim­bursed by the employer.

A

exclu­sive­ly in the per­for­mance of offi­cial duties.

main­te­nance of specified

doc­u­ments

run­ning and main­te­nance of motor car includ­ing remu­ner­a­tion paid

by the employ­er to the chauf­feur and increased by the amount

rep­re­sent­ing nor­mal wear and tear of the motor car at 10% p.a. of

the cost of vehi­cle less any amount charged from the employ­ee for

such use is taxable

C

employ­ee.

A

exclu­sive­ly in the per­for­mance of offi­cial duties.

tax­able

tax­able

rent or nor­mal wear and tear at 10% of actu­al cost of the car) plus

salary of chauf­feur if paid or payable by the employ­er minus amount

recov­ered from the employee.

C

per month, if chauf­feur is also

pro­vid­ed to run the motor car)

employ­ee.

reim­bursed by the employer.

A

main­te­nance of specified

doc­u­ments

the employ­ee or any mem­ber of his household

recov­ered from the employee

C

for per­son­al pur­pos­es of the employ­ee or any mem­ber of his household.

the employ­er minus Rs. 2400

per month and Rs. 900 per month if chauf­fer is also pro­vid­ed minus amount recov­ered from employee.

main­te­nance charges are met or reim­bursed by the employer

main­te­nance of spec­i­fied documents

main­te­nance of spec­i­fied documents

Tax­able only in the hands of spec­i­fied employ­ees [See note 4]

extend­ed

to

1,000 per month per child (irre­spec­tive of num­bers of chil­dren) less amount recov­ered from employee

fam­i­ly

mem­ber

Tax treat­ment in respect of con­tri­bu­tions made to and pay­ment from var­i­ous prov­i­dent funds are summarized

in the table giv­en below:

prov­i­dent fund

Prov­i­dent fund

prov­i­dent fund

on employ­ees contribution

fund

of retire­ment or ter­mi­na­tion of service

(except employee’s

con­tri­bu­tion)