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The new Perquisites rule - Main changes - Summary

CA.Parsun Garg 
on 24 December 2009

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 The new Perquisites rules have been notified and the main changes are under perks for Car/ Driver and for ESOP Schemes. The same have been summarized herein for quick reference. For specific conditions, explanations, etc. and other minor changes,

1. Perks for Car/ Driver

Usage Purpose

Perk Value

I. If Motor Car is Owned by employer & running and maintenance expenses are incurred

or reimbursed by Employer

Official purposes only

 No perquisite, if specified conditions satisfied.

Private purposes only

Actual expense incurred by employer

Add: 10% p.a of Actual Cost of Car or Hire charges of Car

Add: Salary to Driver

Less: amount recovered from employee

Partly Official & partly Private purposes.

Upto 1600CC : Rs 1,800 p.m

Above 1600CC : Rs. 2,400 p.m

Add: If driver provided : Rs.900 p.m

Less: amount recovered from employee

II. If Motor Car is Owned by employee & running and maintenance expenses are incurred or reimbursed by Employer

Official purposes only

No perquisite, if specified conditions satisfied.

Private purposes only

Actual expense incurred by employer as

Less : Amount recovered from employee.

Partly Official & partly Private purposes

Actual expense incurred by employer

Less: amount recovered from employee

Less: Upto 1600CC : Rs. 1,800 p.m

Above 1600CC : Rs. 2,400 p.m

Less: If driver provided : Rs.900 p.m

III. If Motor Car is Owned by employer & running and maintenance expenses are incurred by Employee

Official purposes only

No perquisite, if specified conditions satisfied.

Private purposes only

10% p.a of Actual Cost of Car or Hire charges of Car

Add: Salary to Driver (if paid by employer)

Less: amount recovered from employee

Partly Official & partly Private purposes.

Upto 1600CC : Rs 600 p.m

Above 1600CC : Rs 900 p.m

Add: If driver provided : Rs.900 p.m

Less: amount recovered from employee

IV. If Any other Automotive Conveyance is Owned by employee & running and maintenance expenses are incurred or reimbursed by Employer

Official purposes

only No perquisite, if specified conditions satisfied.

Partly Official & partly Private purposes.

Actual expenditure incurred by employer

Less: amount recovered from employee

Less: Amount for Official use Rs.900 p.m

2. Perks for ESOP Schemes (at the time of exercising the option)

a) For Listed equities

Perk Value of listed sweat equity Shares allotted or transferred free of cost or at concessional rate shall be average of opening and closing price of shares listed on stock exchange on date of exercise of option less any amount recovered from the employee.

 

b) For unlisted equities

Perk Value of unlisted sweat equity shares and other Security allotted or transferred free of cost or at concessional rates shall be the fair market value as determined by the category-I Merchant Banker on the date of exercise of Option or any earlier date, not being earlier than 180 days than the date of exercising, less amount recovered from the employee.




Category Income Tax
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CA.Parsun Garg 

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