Car perk
This query is : Resolved
CA Mandeep Singh
(Querist)
29 July 2011
HELLO SIR/MADAM, IF A DIRECTOR HAS BEEN PROVIDED THREE CARS AND HE IS USING TWO CARS PARTLY FOR BUSINESS AND PARTLY FOR PERSONAL USE, AND ONE CAR IS TOTALLY FOR PERSONAL PURPOSE GIVEN TO HIS SON WHO IS NOT EMPLOYEE OF COMPANY. THEN HOW MUCH VALUE OF SUCH PERKS?
30 July 2011
Where the car is owned or hired by the employer.
If such a car is used exclusively for the private or personal purposes, the actual expenditure incurred by the employer as increased by the amount representing normal wear and tear, would be treated as perquisite value.
Where a car is provided for both official and personal use. In that case, the perquisite value is to be determined as Rs 1,800 per calendar month where the cubic capacity of the engine does not exceed 1.6 litre and Rs 2,400 where it exceeds 1.6 litre. In case a chauffeur is provided, Rs 900 is to be added to the aforesaid perquisite value.
If such a car is used exclusively for the private or personal purposes, the actual expenditure incurred by the employer as increased by the amount representing normal wear and tear, would be treated as perquisite value.
Where a car is provided for both official and personal use. In that case, the perquisite value is to be determined as Rs 1,800 per calendar month where the cubic capacity of the engine does not exceed 1.6 litre and Rs 2,400 where it exceeds 1.6 litre. In case a chauffeur is provided, Rs 900 is to be added to the aforesaid perquisite value.
30 July 2011
It is as per the provisions of section 10(14). The other expert has given you the details for charges of perquisites. The car provided to you son is totally taxable and no expenses is allowable. Out of balance 2 cars the same is to be computed as per the section
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