Is he Govt. Employee For Valuevation u/s 17

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 March 2010 Dear Sir,

My brother is working in Madhya Pradesh Madhya Kshatra vidduyat Vitran Co. Ltd.( MPMKVVCL).Its 100% undertaking of M.P.Government.This co.register under company act.1956.

Company has been provided accomodation on concessional rate to my brother.

My question is....
Is valuevation is determine on the basis of as a govt.employee ?
Or
The basis of any other employee ?

Please clear my query.

Thanking You

Regards

K.Rao

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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17 March 2010 for govt employees Licence fees paid by the Govt for Employee accomodation less any recovery from emplopyee is taxable value of perquisite

Querist : Anonymous

Querist : Anonymous (Querist)

18 March 2010 Dear Ramesh ji,

Question is not what is taxable value but question is that employee is Govt. employee or not.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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01 August 2024 In the context of **Section 17(2) of the Income Tax Act, 1961**, the valuation of perquisites related to accommodation provided by an employer is typically done based on specific rules that apply to all employees, including those working for government undertakings.

Here’s how it works:

### 1. **Valuation of Perquisite Under Section 17(2):**

Section 17(2) deals with the valuation of perquisites provided by an employer to an employee, which includes accommodation (housing) provided at a concessional rate. The rules for valuing such perquisites are as follows:

- **Government Employees vs. Non-Government Employees:** The valuation rules for accommodation perquisites are generally consistent for both government and non-government employees. The valuation is based on the nature of the accommodation and the rate at which it is provided, not specifically on whether the employer is a government or private entity.

### 2. **For Government Undertakings:**

- **Accommodation Provided at Concessional Rates:** If your brother is provided accommodation at a concessional rate, the valuation of this perquisite is done based on the concessional nature of the benefit.

- **Calculation of Perquisite Value:** The value of the perquisite is typically the difference between the market rent and the rent paid by the employee. Specific rules for valuation are provided under the Income Tax Rules, and the same applies irrespective of whether the employer is a government body or a private company.

### 3. **Applicability:**

- **Not Differentiated by Employer Type:** The valuation does not differentiate based on whether the employer is a government entity or a private company. The applicable rules for valuation of accommodation are the same.

- **Example Calculation:** If the market rent of the accommodation is Rs. 10,000 per month and the employee pays Rs. 2,000 per month, then the perquisite value for tax purposes would be Rs. 8,000 per month.

### Summary:

- The valuation of perquisites, including accommodation provided at concessional rates, is governed by the Income Tax Rules and is generally consistent across all types of employers.
- For employees of government undertakings like MPMKVVCL, the same valuation rules apply as for employees of private companies. The value of the perquisite is based on the difference between the market rent and the rent paid by the employee.

For precise calculations and any specific provisions, especially if there are unique conditions or exemptions, consulting a tax professional or referring to detailed Income Tax Rules is advisable.

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