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Rent Free Accomodation by CG

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shivani

student

79 Points Posted on 12 October 2023

employer is central government and providing rent Free Accomodation to employees.
CG (employer) doesn't own the house and therefore CG (employer) deducts TDS u/s 194-I on rent payment to landlord.

now the question is, whether this Rent free accomodation is taxable in the hands of employees? as CG (employer) has already deducted TDS on rent payment.

if yes, then isn't it attract double taxation on single rent income??

Replies (5)

Quick Summary

This discussion explores whether rent-free accommodation provided by the Central Government (CG) is taxable for employees. The CG deducts Tax Deducted at Source (TDS) under Section 194-I on rent paid to landlords. The core question is whether this arrangement leads to double taxation for the employee, as the CG has already accounted for the rent expense via TDS.

Ashwin Kumar

CA ipcc

315 Points Posted on 12 October 2023

It is not taxable (in general sense)...if it's shown as a perquisite in form 16 then it's taxable

RAJA P M

"Do the Right Thing...!!!"

77833 Points Posted on 12 October 2023

@ Shivani,

CG paid rent to LANDLORD...
TDS deducted on rent by CG...

My Doubt is ;
Where is come employee in this transaction...??!

sabyasachi mukherjee

Profession

19978 Points Posted on 13 October 2023

That is a portion. of perquisites...
But since values had not been posted.We cannot arrive at any consensus.

RAJA P M

"Do the Right Thing...!!!"

77833 Points Posted on 13 October 2023

Originally posted by : sabyasachi mukherjee
	That is a portion. of perquisites...But since values had not been posted.We cannot arrive at any consensus.

Iyyo raamaa...

Thayavu seythu amaithiyaa irunka iyyaa...

Aashok Kumar Sharma

Finance/Compliance Consultant

75819 Points Posted on 08 November 2026

Central Government RFA:

• For Central or State Government employees, the value of rent-free accommodation is the licence fee determined by the government for such accommodation (Rule 3(1), Table I, Sl. 1), reduced by rent recovered. If the government charges a licence fee equal to or more than the prescribed amount (and recovers it), the perquisite is nil.

• If the government doesn't own the accommodation but leases it (and provides it free), the valuation for government employees is still the licence fee as per government rules (Rule 3(1) Sl. 1 applies to accommodation "provided by the Central or State Government", whether owned or leased).

• Report the perquisite value in Form 12BA, taxable as salary.