Hi Cite HR members,
Please help me in the issue of understanding......is this true that the employee has to pay tax on the amount he/she has taken from the company for a leased accommodation.... If so on what rate?
Else is there any benefit of taking a leased accommodation?
thanks,
Ashi
From India, Bangalore
Please help me in the issue of understanding......is this true that the employee has to pay tax on the amount he/she has taken from the company for a leased accommodation.... If so on what rate?
Else is there any benefit of taking a leased accommodation?
thanks,
Ashi
From India, Bangalore
Yes. An employee has to pay tax on the amount he/she has taken from the company for a leased accommodation. The rate depends on the place of availing the facilities. In metros its 15% and in small town its 7.5%.
This is applicable even if your own house is taken on company lease for your residencial use. In such case, you will have to pay income tax on rent as owner and perquisite tax for as an employee for availing the facility.
Many people opt for HRA when no such perquisite tax is applicable. But the amount will be usually less than the lease rent.
Hope this will serve your purpose.
From India
2This is applicable even if your own house is taken on company lease for your residencial use. In such case, you will have to pay income tax on rent as owner and perquisite tax for as an employee for availing the facility.
Many people opt for HRA when no such perquisite tax is applicable. But the amount will be usually less than the lease rent.
Hope this will serve your purpose.
From India
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