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Rules Regarding Calculation Of Value Of 'Rent Free House' For Computing Salary Income

R
Ramasamy Ulaganathan
28/06/2017 0 0
 
I- For Unfurnished Accommodation

(A) Owned by employer

(a) Govt. Employees. The value of house is rent fixed [license feel by the govt. for such house. It can be rent charged by Govt. from another employee of same status for similar type of house. Market rental value of this type of accommodation is not taken into account and hence ignored.

(b) Other employees. Value of house to be taxed is calculated in following manner :

(i) In cities the population of which is more than 25 lakhs as per census of 2001:

15% of Salary.

(ii) In cities the population of which is exceeding 10 lakhs but not exceeding 25 laths as per census of 2001 :

10% of Salary.

 

(iii) In cities and towns the population of which is 10 lakhs or less than 10 lakhs as per 2001 census :

7½% of Salary.

(iv) Hotel accommodation [for more than 15 days on transfer from one place to another ] :

24% of Salary (for the period or days for which accommodation is provided in hotel) or actual bill which ever is less is taxable.

B. Hired by employer :                 

15% of Salary or Actual rent paid or payable by employer which ever is less is taxable in all cities.

II - For furnished accommodation

In case of all types of employees calculate value of unfinished house.

If furniture is owned by employer add 10% p.a. of cost of furniture.

If furniture is hired actual hire charges paid or payable by employer are added.

The term ‘furniture’ includes usual items of furniture like sofas, beds, chairs, tables and other household appliances. It also includes modem electrical appliances like television, radio, refrigerator, air conditioner, geyser, etc.

 

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