If a car loan from employer forms part of the flexi kitty, will it be taxable salary in the hands of the employee? Please guide me. Many thanks! Venkatesh N Manager- HR
From India, Trichy
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From India, Trichy
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No, it is not taxable at the hands of employees if company is paying EMI and the same is deducted in Employees CTC. Pon
From India, Lucknow
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660From India, Lucknow
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Hi,
You need to refer to the Income Tax Act for the same. Please refer to [Income Tax India](http://www.incometaxindia.gov.in/publications/9_Income_Tax_For_NRI/Chapter003.asp).
The thumb rule in your case should be: If the car EMI is not part of the CTC, not for personal use, registered in the company name, used for official purposes only (at least on paper), and registered in the company's name, then there will be no income tax applicable.
Regards,
Govind
From India, Mumbai
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You need to refer to the Income Tax Act for the same. Please refer to [Income Tax India](http://www.incometaxindia.gov.in/publications/9_Income_Tax_For_NRI/Chapter003.asp).
The thumb rule in your case should be: If the car EMI is not part of the CTC, not for personal use, registered in the company name, used for official purposes only (at least on paper), and registered in the company's name, then there will be no income tax applicable.
Regards,
Govind
From India, Mumbai
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Thank you, sir. The purpose is to peel off this component from taxable salary. Could the employer himself extend this loan to the employee, wherein the vehicle is hypothecated to the employer until completion of the loan amount, deduct the loan EMI from the monthly salary? Please clarify.
Many thanks,
Venkatesh N
From India, Trichy
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Many thanks,
Venkatesh N
From India, Trichy
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It is a car scheme offered by the employer. The vehicle will be in the name of the employer. After the EMIs, the car is transferred to employees at a nominal cost or without cost as per company policies. However, the car shall be used for official purposes during the EMI period.
Pon
From India, Lucknow
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Pon
From India, Lucknow
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Hi, You just keep in mind that the car for which your organisation is paying EMI should be registered in company name
From India, Mumbai
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From India, Mumbai
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From 1-4-2008, if an employer provides a facility to his employee, the employer is not liable to pay fringe benefit tax. The value of such perquisite shall be as follows:
a) Nil, if the motor car is used by the employee wholly and exclusively in the performance of his official duties.
b) Actual expenditure incurred by the employer on the running and maintenance of the motor car, including remuneration to the chauffeur, as increased by the amount representing normal wear and tear of the motor car, and as reduced by any amount charged from the employee for such use (in case the motor car is exclusively for private or personal purposes of the employee or any member of his household).
c) Rs. 1200- (plus Rs. 600- if chauffeur is also provided) per month (in case the motor car is used partly in the performance of duties and partly for private or personal purposes of the employee or any member of his household if the expenses on maintenance and running of the motor car are met or reimbursed by the employer). However, the value of the perquisite will be Rs. 1600- (plus Rs. 600- if chauffeur is also provided) per month if the cubic capacity of the engine of the motor car exceeds 1.6 litres.
d) Rs. 400- (plus Rs. 600- if chauffeur is also provided) per month (In case the motor car is used partly in the performance of duties and partly for private or personal purposes of the employee or any member of his household if the expenses on maintenance and running of the motor car for such private or personal use are fully met by the employee). However, the value of the perquisite will be Rs. 600- (plus Rs. 600- if chauffeur is also provided) per month if the cubic capacity of the engine of the motor car exceeds 1.6 litres. If the motor car or any other automotive conveyance is owned by the employee but the actual running and maintenance charges are met or reimbursed by the employer, the method of valuation of the perquisite value is different. (See Rule 3(2)).
From India, Ahmadabad
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a) Nil, if the motor car is used by the employee wholly and exclusively in the performance of his official duties.
b) Actual expenditure incurred by the employer on the running and maintenance of the motor car, including remuneration to the chauffeur, as increased by the amount representing normal wear and tear of the motor car, and as reduced by any amount charged from the employee for such use (in case the motor car is exclusively for private or personal purposes of the employee or any member of his household).
c) Rs. 1200- (plus Rs. 600- if chauffeur is also provided) per month (in case the motor car is used partly in the performance of duties and partly for private or personal purposes of the employee or any member of his household if the expenses on maintenance and running of the motor car are met or reimbursed by the employer). However, the value of the perquisite will be Rs. 1600- (plus Rs. 600- if chauffeur is also provided) per month if the cubic capacity of the engine of the motor car exceeds 1.6 litres.
d) Rs. 400- (plus Rs. 600- if chauffeur is also provided) per month (In case the motor car is used partly in the performance of duties and partly for private or personal purposes of the employee or any member of his household if the expenses on maintenance and running of the motor car for such private or personal use are fully met by the employee). However, the value of the perquisite will be Rs. 600- (plus Rs. 600- if chauffeur is also provided) per month if the cubic capacity of the engine of the motor car exceeds 1.6 litres. If the motor car or any other automotive conveyance is owned by the employee but the actual running and maintenance charges are met or reimbursed by the employer, the method of valuation of the perquisite value is different. (See Rule 3(2)).
From India, Ahmadabad
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CAR LEASE POLICY.pdf