No.

1 2 3

Salary Structure Basic Salary DA HRA

4 5

Computer Allowance Conveyance (Transport) Allowance

6 7 8 9

Foreign Allowance Helper Allowance Children Education Allownce Children Hostel Allowance(Amount granted to meet hostel expenditure on employee's children) Electricity Expense Allowance Conveyance Allowance (Reimbursement-Fixed Amount over & above the amount referred at S.No. 5) Outstation Allowance Entertainment Expense Allowance Clothing/Uniform Allowance

10 11

12 13 14

15 16

Bonus/Ex Gratia Reimbursement of car expenses in case of cars owned by the employer

17

Reimbursement of fuel bills in case of car owned by the employee.

18

Reimbursement of scooter expenses in case of scooter owned by the employer.

19

Reimbursement of scooter expenses in case of scooter owned by the employee.

20

Leave Travel Allowance

21

Leave Encashment

21

Leave Encashment

22

Canteen Expense on monthly fixed basis.

23 24

Provident Fund Gratuity

25

Telephone Expenses/(Actuals)

26

Medical Facilities

27 28

Medical Reimbursement Rent free Furnished

Accommodation: Where accommodation is owned by employer.

Where accommodation is taken on lease or rent by the employer.

Where accommodation is provided by the employer in the hotel (except where aggregate period of stay does not exceed 15 days on his transfer from one place to another).

29

Sweeper, gardener, watchman, personal attendant

30

Interest free advances/ loans to employee or anymember of his household by the employer or anyperson on his behalf.

31 32

Personal / Group Accident Insurance Policy Gift or voucher or token

32

Gift or voucher or token

33

Gas, Electric Energy and Water

34

Free or concessional fare.

35

Travelling, Touring, accommodation and other expenses

36

Movable Asset :

36

Where any movable asset (other than motor cars or laptops or computers) belonging to employer or hired by himfor the use of employees or any member of hishousehold. Where any movable asset belonging to employer are transferred to employee directly or indirectlyor any member of his household. In case of computers and electronic items.

In case of motor cars.

37 38

Free education facility to employee. Free or concessional educational facilties for any member of employee's household.

39

Credit Card

40

Expenditure in Club

41

Stock Options

42

Any other benefit

43

Tax on Perquisites Borne by Employer

44

Tax on Remuneration paid to Technician (not resident in any of four financial years preceding the year when he arrived in India)

45

Passage money or free or concessional passage

45 on home leave or proceeding to home country after retirement to foreign employees, not being citizens of India.

Exempt

Max exemption is restricted to least of the following three amounts: 1. 50% of salary (40% in case of cities other than metros 2. Excess of rent paid over 10% of salary 3. Actual amount of HRA received. Exempt under S.10(14)/ Rule 2BB upto Rs. 800/- p.m. Exempt if allowance is granted to meet his expenditure forthe purpose of commuting between the place of hisresidence and the place of duty.

Exempt to the extent incurred on helper where such helper is engaged for performance of official duties. Exempt upto Rs. 100 p.m. per child for a maximum of 2 children. Exempt upto Rs. 300 p.m. per child for a maximum of 2 children.

Exempt to the extent conveyance allowance is utilised for meeting expenditure on conveyance for performing official duties.

Exempt where allowance is given to meet the expenditure on the purchase or maintenance of uniform for wear during the performance of official duties. Expenses are met or reimbursed by the employer, If car is used so far for official purposes, No amount is taxable provided documents as specified in Note A are maintained by the employer. Note A: The following conditions should be fulfilled: 1. the employer has maintained complete details of journey undertaken for official purpose which may include date of journey, destination, mileage and the amount of expenditureincurred thereon;

2. the employer gives a certificate to the effect that the expenditure was incurred wholly and exclusively for the performanceof official duties.

Earlier Rules: Where car is used for official purposes , not a perquisite and hence not taxable.

Where maintenance & running expenses are met by employer

if car is used wholly for official purposes, nil

provided the documents as specified in Note A above are maintained by employer.

Earlier Rules:Where car is used for official purpose only , and expenses are met by the employer, this will not amount to perquisite. New rules for valuation of perquisites do not specify the treatment under this case, hence old rules can be taken as the base for valuing this perquisite. Earlier Rules: If reimbursed for official use only , then not taxable.

Where expenses are met or reimbursed by employerfor the use for official purposes, no value is taxable provided documents specified in Note A above are maintained by the employer.

Earlier Rules: Where expenses are reimbursed for the official use only , not taxable.

Exempt from tax under S.10(5) maximum upto twice in a block of 4 years. (Current block- 1st January 2002- 31st December 2005)Exemption is available for actual amount spent on travel to any place in India for himself and his family as provided in Rule 2Bof Income Tax Rules. If paid on retirement whether on superannuation or otherwise, amount is exempt from tax to the extent of least of the following:

a. Cash equivalent of leave salary in respect of period of earned leave to the credit of an employee only at the time of retirement whether on superannuation or otherwise. b. 10 months average salary. c. The amount not chargeable to tax as specified by Government from time to time (at present Rs. 300,000/-)in case of employees retire whether on superannuation or otherwise on or after 1.4.1998 d. Leave encashment actually received on retirement. It shall not be a perquisite in the following cases 1. Free meals provided by the employer during office hours at office or business premises or through paid vouchers which are not transferable and are usable only at eating joints,if the value thereof in either case is upto Rs.50 per meal. 2. Tea or snacks provided during office hours. 3. Free meals during working hours provided in a remote area or an offshore installation. Earlier Rules: Refreshments/subsidised lunch or dinner Exempt when provided in the office premises during workinghours. An amount upto Rs. 35 per day if provided outside the place of work and amount is paid by employer directly to caterer,restaurant etc. is exempt. Contribution by an employer to recognised Provident Fund is exempt upto 12% of salary. For employees covered by the Payment of Gratuity Act: Any gratuity received by employee is exempt from tax to the extent of least of the following: 1. 15 days salary for every completed year of service or part thereof in excess of 6 months. 2. Rs. 3,50,000/3. Gratuity actually received. In case of other employees:Any other gratuity received by an employee on retirement, death, termination, resignation is exempt from tax to the extent of least of the following: 1. Rs. 3,50,000/2. Half month's salary for each completed year of service. 3. Gratuity actually received. Any provision for gratuity in the books of accounts by the company for the benefit of employees is not taxable during the tenure of service of the employees.

Not Taxable

1. Medical insurance taken by the employer for the employee or any member of the employee's familyor any reimbursement to employee of insurance premium which he has incurred is exempt. 2. Reimbursement by employer, of expenses incurred by employee on his medical treatment or that of any other member of his family in any hospital maintained by Govt. or in a hospital approved by Govt. or where payment is made by the employer directly to hospital etc. approved by the Chief Commisioner of Income Tax in connection with treatment of prescribed diseases orailments of employee or any member of his family is exempt. Reimbursement of such expenses are exempt upto Rs.15,000/- when the expenditure is actually incurred by the employee.

The value of accommodation in a remote area provided to an employee working at a mining site or an on-shore oil exploration site or a project execution site or at offshore site will not be treated as perquisite A remote area means an area located at least 40 KM away from a town having a population not exceeding 20,000 . A project site means a site of project upto the stage of its commissioning. Off-shore site do not have to meet the requirement of distance.

Note: No value would be charged if loans are made available for medical treatment in respect of diseases specified in prescribed Rules and where loans are petty, not exceeding in the aggregate Rs. 20,000/. Earlier Rules : Any such benefit given to employee is not taxable . Premium amount paid by employer is exempt No perquisite where the value is upto Rs. 5,000/- in aggregate during the financial year. However, gifts made in cash or convertible into cash, like gift cheques etc. will be taxable as perquisite.

Earlier Rules : Not provided in the Earlier Rules. Should be taxable.

Earlier Rules : If such benefit is used for official purposes, nothing would betaxable.

Earlier Rules : Exempt where provision by any undertaking (employer) engaged incarriage of passengers or goods, to employeefor free or at concessional fare, where conveyance is owned bysuch undertaking.

Earlier Rules:Not taxable where travel for official purposes.

Amount spent by employer for training/educating employee is exempt. Educational facilties to children of employee in educational institution maintained and owned by emmployer or in any institution by reason of his being in employment of that employer.Not taxable if value of such benefit per child does not exceed Rs. 1000/- per month.

Where expenses are incurred wholly and exclusively for official purposes, the amount is not taxable provided the following conditions are fulfilled: complete details in respect of expenses including the dateand nature of expenses, are maintained; a employer gives a certificate that expenditure is incurred wholly and exclusively for performance of official duties;

If such expenditure is incurred wholly and exclusively for business purposes, the amount is not taxable and the followed conditions are fulfilled: complete details in respect of expenses including the datenature of expenses and its business expendiency, are maintained; the employer gives a certificate that the expenditure is incurred wholly and exclusively for performance of official duties.

Where use of health club, sports and similar facilties are provided uniformly to all employees by the employer, no amount is taxable.

Earlier Rules : Club Membership provided to an employee by the employer purely for business purposes may not be considered as taxable in the hands of employees. The value of any benefit provided by a company free of cost or at a concessional rate to its employees by way of allotment of shares, debentures or warrants directly or indirectly under any Employees Stock Option Plan or scheme by the company offered to employees in accordance with the guidelines issued in this behalf by the Central Government, is not taxable

Where Employer at its option pay tax on the whole or part value of perquisite (not provided for by way of monetary payments), on behalf an employee, without making any deduction from the income of the employee, such amount of tax so paid by employer shall not be treated as perquisite in the hands of the employee.

Taxable Taxable Taxable

Taxable

Taxable

Taxable Please refer tax treatment at S.No.16,17,18 & 19

Taxable Taxable

Taxable

Where car is used for official and personal purposes:

Expenses are fully met or reimbursed by the employer, where cubic capacity of engine does not exceed 1.6 litres,Rs. 1200// if exceeds 1.6 litres, Rs. 1600/- (+Rs. 600. If chauffeur is also provided), Where expenses for private use are fully met by the employee,

where cubic capacity of engine does not exceed 1.6 litres, Rs. 400/if exceeds 1.6 litres, Rs. 600/- (+Rs. 600. If chauffeur is also provided), Where car is used for personal purposes Expenses incurred by employer on running and maintenance of car plus value of normal wear and tear plus remunerationpaid to chauffeur less amount charged from employee, if any. Where one or more car are owned or hired by the employer and the employee or member of his household are allowed the use of such motor car or all or any of such motor car(otherwise than for official duties), value of perquisite shall be amount calculated in respect of one car as if the employee had been provided one motor car for use partly inperformance of his duties and partly for private purposes and the amount calculated in respect of other car, as if provided exclusively for private purpose.

Normal wear and tear shall be taken at 10% p.a. of the acutal cost of the motor car. Earlier Rules: When car is owned or hired by the employer and is used partly for official and partly for private purposes and the running & maintenance expenses are met by the employer and it is difficult to identify value of private use then the perquisitevalue will be Rs.600 p.m./Rs.800 p.m. where h.p. rating does not exceed16/ exceeds 16 (plus Rs.300 p.m. where chauffeur is provided)

When car is used for private purpose, Amount actually incurred by employer for running & maintenance of the car, normal depreciation, if it is owned by the empoyer or hire charges, if car is hired and remuneration paid to chauffeur is taxable Where one or more cars as owned or hired by the employer are allowed to be used by the employee (otherwise than wholly and exclusively for official duties), value of perquisite shall be amount calculated in respect of one car as if the employee had been provided one motor car for use partly in performance of his duties and partly for private purposes. Where maintenance and running expenses are met by employer, if car is partly used for officialpurposes and partly for private purposes, subject to Note B below, the actual expenditure incurred by employer as reduced by Rs. 1200/- /Rs. 1600/- depending upon the cubic capacity of engines and Rs. 600/- for chauffeur, if provided. Note B:

Where the employer or the employee claims that the motor caris used wholly and exclusively in the performance of official duty or that actual expenses on the running and maintenance of the motor car owned by the employee for official purposesis more than the amounts deductible as mentioned above he may claim a higher amount attributable to official use and the value of perquisite shall be actual amount of charges met by employer as reduced by such higher amount attributableto official use of the vehicle provided conditions in Note A above are fulfilled.

If used for private purpose only, then actual amount spent on running, maintenance & normal wear and tear is taxable. Earlier Rules :Where car is owned by employee and used for official and private purposes and expenses are met by employer, a reasonable proportion of the sum actually spent by the employer attributable to personal use is taxable.Where car is used for private purposes only , actual expenditure of the employer is taxable.

New rules for valuation of perquisites do not specify the treatment under this case, hence old rules can be taken as the base for valuing this perquisite.

Earlier Rules:If used for private purpose only , then actual amount spent on running, maintenance & normal wear and tear is taxable. If used partly for official and partly for private purpose , a reasonableproportion of the amount actually spent by the employer for running,maintenance & normal wear and tear is taxable. Where car is used for official and private purposes, subject to Note B above, the actual expenditure incurred by employer as reduced by Rs.600/- . If used for private purpose only, then actual amount spent on running, maintenance & normal wear and tear is taxable. Earlier Rules: Amount reimbursed by the employer for private purpose is taxable. Amount reimbursed by the employer for the use of official & private purpose , a reasonable proportion of the amount reimbursed is taxable.

Taxable if paid during continuance of employment.

Taxable if paid during continuance of employment.

Otherwise the amount of expenditure incurred by the employer is taxable.

Any gratuity paid to an employee while still in service is taxable.

Expenses on telephones including mobile phone actually incurred on behalf of employee by employer shall not be taxable in the hands of employee. Earlier Rules:May be considered as exempt depending upon the nature of job.

In case accomodation is in cities having populationexceeding 4 lacs - 10% of Salary7.5% of Salary in other cities.

In respect of period for which accommodation was occupiedby the employee, as reduced by the amount of rent if any, paid by employee. Actual amount of lease rental paid by employer or 10% of salary, whichever is lower as reduced by the rent, if any, actually paid by the employee. The value of perquisite, as determined in either of the cases above, is increased by 10% of cost of furniture (p.a.) (including television sets, radio sets, refrigerators, other household appliances, air conditioning plant or equipment or other similar appliances) or if furniture is hired, the hire charges, as reduced by the amount, paid by employee. 24% of salary or actual charges to the hotel, whichever is lower, for the period during which such accommodation isprovided as reduced by the rent,if any, paid by employee. Earlier Rules: In case accommodation is in Delhi, Bombay, Calcutta & Madras (or in other cities): 1. If fair rent is less than 10% of salary, fair rent is taxable. 2. If fair rent is 10% of salary or more but not more than 60% ofsalary (50% in case of other cities), 10% of salary is taxable.

3. If fair rent exceeds 60% of salary, (50% in case of other cities),fair rent minus 50% of salary (40% in case of other cities) is taxable. If any furniture is also provided by the company to the employee then either 10% of original cost of assets purchased or any hire charges paid for furniture, whichever is applicable, shallbe added to the cost of such accommodation. Where accomodation is provided at concessional rent, the valuation will be made as if employee had been provided rent free accomodationand amount so computed will be reduced by rent payable by employee.

Where employer has provided sweeper, gardener, watchman,personal attendant, the actual cost to the employer shall be taxable as perquisite which is total amount of salary and allowances paid to them as reduced by amount paid by employee. Earlier Rules: a. When sweeper, watchman or gardener are recruited andremunerated by employer- Rs. 120 p.m. per person is taxable.However, if employed by employee and the amount paid to such persons is reimbursed by employer to employee, then the entireamount so reimbursed is taxable in the hands of employee. b. Any other servants, entire amount spent on other servants is taxable. Sum equal to simple interest @ 10% p.a. in respect of loans for house and conveyance and @ 13% p.a. for other loans on maximum outstanding monthly balance (aggregate outstanding balance for each loan as on the last day of each month)

Value of perquisites shall be sum equal to the amount of giftor voucher or token in lieu of which such gift may be received by the employee or by member of his household on ceremonial occasions or otherwise.

Value of perquisites shall be sum equal to the amount of giftor voucher or token in lieu of which such gift may be received by the employee or by member of his household on ceremonial occasions or otherwise.

Where supply is made from resources owned by the employer without purchasing them from any other outside agency, manufacturing cost per unit incurred by employer. Where supply is made by purchasing from outside agency, amount paid to supplying agency is taxable less any amount paidby the employee. Earlier Rules : Where employer has supplied gas, electricity & water from own sources, not taxable Where provided by purchasing from outside agency,any such benefit provided and used partly for official andprivate purposes will be taxable @ 6.25% of salary or the actualamount spent whichever is less. If such benefit is used for private purposes , amount actuallyspent is taxable. Provision by any undertaking engaged in carriage of passengers or goods to employee or to any member of his household for free or at concessional fare, in any conveyance owned, leased or made available by any other arrangement by the undertaking, value at which such benefit or amenity is offered by such undertaking to the public as reduced by amount recovered from employee. Note: This sub rule is not applicable to the employees of railways from 1.4.2001.

Where such expenses are borne or reimbursed by employer for any holiday other than leave travel allowanceavailed by employee or member of his house, amount incurred by employer.

Where such facility is maintained by employer and is not available uniformly to all employees, value at which suchfacilties are offered by other agencies to the public. Where employee is on official tour and expenses are incurred in respect of any member of his houseaccompanying him, amount of such expenses. Where official tour is extended as a vacation, value shall be limited to expenses incurred in relation to such extended period of stay or vacation Value shall be determined @ 10% p.a. of actual cost of such asset or amount of rent or charge paid or payable by employer.

Actual cost of asset to employer as reduced by normal wear and tear @ 10% of such cost for each completed year during which asset was put to use by employer. Actual cost to employer as reduced by normal wear and tear @ 50% by reducing method. Actual cost reduced by normal wear and tear @ 20% by the reducing method. Earlier Rules:Tax may be computed on the written down value at which the asset istransferred as reduced by the amount recovered from the employee.

Amount spent by employer for free or concessional educational facilties for any member of employee's household is taxable.

Education facilties to employee's family members in institution maintained by employer or in any other, educational institution by reason of his being inemployment of that employer . Cost of education in a similar institution in or near the locality shall be the amount ofperquisite. Earlier Rules : Reimbursement of expenditure incurred for education of family members of employee is fully taxable. The amount of expenses including membership fees and annual fees incurred by the employee or member of his household charged to a credit card including add-on card,provided by employer or otherwise, paid for or reimbursed by employer shall be taken as value of perquisite.

Earlier Rules : Taxable where used for private purposes.

Actual amount of expenditure including annual or periodical fee or incurred by employee or by any member of his household. Where corporate membership of club is obtained by employer, which is enjoyed by employee or any member ofhis house, value of perquisite shall not include initial fees paid for acquiring corporate membership.

Any profit and gains arising from the transfer of shares/debentures/warrants alloted under ESOP shall be chargeable to income tax under the head 'capital gains' and shall be deemed to be income of previous year in which transfer took place.

Any other benefit, amenity, service, right or priviledge provided by the employer shall be determined on the basis of cost to the employer as reduced by employee's contribution, if any.

The tax if borne by employer on the remuneration of technician, shall now be taxable in the hands of such technician.

Earlier Provisions: The tax so borne by employer was not included in the computation of total income of technician and thus was exempt from tax. The amount of passage money etc. so provided to the employees

shall be taxable.

Earlier Provisions: Exemption from tax was available in respect of passage moneys, etc.