Property on lease

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 June 2011 A is about to join X ltd.at a VP level. He wants to structure his salary in the following form . Please inform whether this is proper tax planning under the existing tax laws & in DTC:
A is owning a property in his own name. He intends to lease the same to his prospective employer by entering into proper agreement. The employer would pay him lease rent.Queries are:
1.) Can A claim the income as taxable under income from house property?
2.) If answer to 1 is no then would it be treated as HRA in the hands of A.
Can anybody please enlighten on the same.
Thanks in advance.

CA MANOJ GUPTA

CA MANOJ GUPTA (Expert)

30 June 2011 1. Yes
2. Perquisite value will be taxed in X,s hands
Actual amount of lease rental paid or payable by the employer or fifteen per cent of salary, whichever is lower in respect of the period during which the said accommodation was occupied by X will be taxed as perquisite

CA MANOJ GUPTA
JODHPUR
09828510543
gm2104@gmail.com

Querist : Anonymous

Querist : Anonymous (Querist)

30 June 2011 Sir,
A would continue to occupy the property. I presume X would get a deduction in his assessment. How would it be treated as perquisite in the hands of X? Can you please elaborate.
Regards,

CA MANOJ GUPTA

CA MANOJ GUPTA (Expert)

30 June 2011 In the reply in place of X read A

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