How to report Section 10(10CC) in Form 16?

Good day. The same amount of perquisite is not to be claimed us 10 10Ccc,only the tax due on perquisite is to be claimed as exempt. The non monetary perquisite to be added with salary. 

Okay, that makes sense for cases where tax is covered on a perquisite. But I’m asking about the scenario where the employer covers the tax on the employee’s entire salary, not just the perquisite...

@ Caroline Williams 
Got it, thanks a lot for clarifying this 🙏 that really helps!

Yes Employer has to  deducted tds  on salary and perquisite. 

10(10CC) is narrow. It covers tax on non-monetary perquisites only:

• Sec 10(10CC): where the employer bears the employee's tax on non-monetary perquisites (e.g. rent-free accommodation, a car), that tax paid by the employer is exempt and is not a further perquisite. The perquisite value itself remains taxable under Sec 17(2).

• In Form 16: show the perquisite value in Part B under 17(2), and the tax paid by the employer (on those perquisites) as exempt under 10(10CC). The employer can't claim that tax as a business deduction (Sec 40(a)(v)).

• Tax gross-up on salary or monetary items (e.g. "net of tax" salary contracts, expatriate tax equalisation on cash pay): the tax borne by the employer is itself a taxable monetary perquisite. 10(10CC) doesn't apply. Gross up the salary (tax on tax, iteratively) and deduct TDS on the grossed-up amount (Sec 195A applies to non-residents; for residents, gross up by agreement).

• Report the 10(10CC) amount in the ITR under "Exempt allowances – 10(10CC)".

Yes—where the employer pays the employee’s tax on a non-monetary perquisite, report the tax borne as a perquisite under section 17(2), and claim the corresponding exemption under section 10(10CC). This avoids taxing that non-monetary tax payment again as the employee’s income; it does not mean the underlying salary or other taxable perquisites are exempt.

In Form 12BA, show it under “Other benefits or amenities” (often described as “Others”), with a clear descripttion such as “employer-paid tax on non-monetary perquisite.” In Form 16, include the amount in the section 17(2) perquisite total and separately report the section 10(10CC) exemption in the relevant exemption field/schedule. Reconcile the figures with the salary computation and TDS workings.

For gross-up, calculate the employer-borne tax consistently with the taxable salary and perquisites. For hypo-tax, only the tax actually borne by the employer on the employee’s non-monetary perquisite is relevant; an employee’s notional hypo-tax deduction or a tax amount recovered from the employee should not automatically be treated as an exempt perquisite. Check the facts and current Form 16 utility fields before filing.

This treatment fits naturally into the salary-tax computation and Form 16 reconciliation workflow. Manual preparation across gross-up, hypo-tax and perquisite reporting is difficult; automation reduces repetitive work while professional judgment remains in control. At Jir AI, our 2,000+ AI agents and 650+ integrations streamline GST, ITR, TDS, TCS and other compliance workflows, helping reduce manual workload by up to 70%. For a smoother compliance workflow, connect with us on WhatsApp: https://wa.me/message/3HVOZ7HIY4ESC1