Taxabillity of Transport facility

1) If the transportation facility is provided for daily commuting for official purposes, then it is excempted u/s. 10(14) to the extent of

a) Rs. 800 /-  p.m. and

b) Rs. 1600 /- in case of employee is blind or orthopadically handicapped.

2) If the employee is working for a trasport system and he gets the amount for personal expenses during the course of running of such transport (vehicle), then it is excempted lower of :-

a) 70 % of such allowance or

b) Rs. 6000 /-. p.m.

As far as perquisites are concerned:-

a) it is excempt fully to employees of railways and airlines.

b) In case of employess other than (a) but only transport undertaking, perquisite is valued as follows :-

     i) Find out cost to employer       xx

    ii) Recovery from employee       (x)

   iii) Balance amount Taxable     xxx        (if positive)

but those provisions are applicable for transport allowance and not in this case....

if conveyance is provided to go to office from home and to return to home from office then it is not a taxable perquisite as it is used for official purposes...i hope mr.benny is talking about tat kind of transportation facility

Originally posted by : Benny Thadathil
	If an employer provides free transporatation to its employees, is  this to be  considered as a taxable perquisite?

When there is a facility of transportation comes it goes under perquisites and in case of perqusites valuation is as follows:

1.  Employees of railway/airlines                                                NIL

2.  Employees of any other undertaking

Value at which such benefit is offered by the employer to the public              xxx

Less: Amount recovered from employee                                                              (xxx)

Balance is Taxable                                                                                                     xxx

But if you are talking of Transport Allowances(part of salary) then its different they will be exempted upto 800 pm or 1600 pm (physically chalenged). Balance will be taxable.

Originally posted by : swajitha
	if conveyance is provided to go to office from home and to return to home from office then it is not a taxable perquisite as it is used for official purposes...i hope mr.benny is talking about tat kind of transportation facility

Dear Swajitha,

Dont you think if transport facility is not taxable then it will become a point for tax planning??? and u can pay any amount under this and will not be taxable??...and pls mention in which section it is not taxable??

Thanks

Sorry Mr. Benny and Swajitha,

My query is also solved and with this discussion i also got one more point.

Thanks.

In my opion, Mr. Benny this transporation is not include in the employee's income. it is an expenses made by the employer so employer can take deduction for this in the p&l A/c. 

swajitha is right................

swajitha is right................

Kindly refer Explanation to sec 17 (2) iii

[Explanation.—For the removal of doubts, it is hereby declared that the use of any vehicle provided by a company or an employer for journey by the assessee from his residence to his office or other place of work, or from such office or place to his residence, shall not be regarded as a benefit or amenity granted or provided to him free of cost or at concessional rate for the purposes of this sub-clause;]

as per joshi statment its correct but its clear bifercation about official & unofficial

unofficial then its not taxable (means travel from office to house) &

official deduction limit us 800/- & blind person -1600/-