Our Company has a guest house owned by it. Three Executives are staying there for the past 2 years and are paying subsidised room rent. My question is can we deduct tax on house perquiste from them. My GM(Finance) says Guest House does not come under house perquisite. Kindly advice.
1 Answers
Employee are liable to pay income tax on the perquisite value of the house provided by company.
The perquisite value of the house would be 7.5%-15% (depending on city population) of salary minus actual rent paid by employee to employer.
This value would be added to employee's taxable income under head income from salaries and taxed as per slab rates.
my question was specific..i.e "guest house" owned by the company. house perquisite is being deducted for company owned quarters but not for guest house in our company. The reason cited by the finance deptt. is that no allotment order has been given by the personnel deptt. for guest house.
Guest house may have a rental value and company may be already paying rent for same. It should have perquisite value for employee using this benefit.
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