DASHMESH KHALSA COLLEGE,

ZIRAKHPUR
PRESENTATION ON SALARY

SUBMITTED TO –
Dr. Jyoti Saluja SUBMITTED BY –
Taranjit kaur (1818)
Ranvir Kaur (1822)
Harsimran kaur
(1824)
PERQUISITES
In simple words perquisites can be defined as any extra
benefit or facility provided by the Employer to his
employee.
TYPES OF PERQUISITES
There are mainly three types of Perquisites from income tax point
of view which are as follows.

1. Tax Free Perquisites

2. Perquisites Taxable in Specified cases
3. Perquisites Taxable in all the cases
 TAX FREE PERQUISITES

There are certain perquisites the value of which is not taxable at all
in the hands of employee therefore these perquisites are also known
as tax free. Some of the important perquisites are as follows –
 Medical Reimbursement –

 Medical facility is fully taxable from the assessment year 2019-

2020 in lieu of this standard deduction of Rs.40,000 u/s 16 is
allowed.
 If treatment is taken from Abroad it is exempted up to the amount
allowed/sanctioned by RBI.
 Lunch Facility – Lunch facility up to the cost of Rs.50 per lunch
shall be exempted and if the cost is more than the amount
Rs.50 then the excess amount shall be taxable.
 Free refreshment facility - It is provided during the office hours by
the employer to his employee which is fully exempted.
 Telephone bill facility – This facility is also exempted if telephone
connection belongs to the employer but where it does not belong to the
employer it is fully taxable .
 Cost of refresher course and training of the employee – This cost is
also met by the employer which is also exempted from tax.
 Value of gift – Value of the gift up to the cost of Rs. 5000 shall also be
Exempted .
 Conveyance Facility – It is also provided by the employer to his
employee from the residence to the place of work and vice versa.
 Interest free loan – interest free loan provided by the employer to
Employee is exempted provided the amount of the loan is less than
Rs.20,000 or loan is taken for the purpose of medical treatment
 Transfer of movable assets – transfer of movable assets by
employer to his employee is exempted provided the amount of
the asset is more than 10 years old .
Other facilities such as free laptops or computers and free
ration facilities to armed forces are also provide by the
employer to his employee which are exempted from tax.
 PERQUISITES TAXABLE
FOR SPECIFIED
EMPLOYEES
There are certain perquisites which are taxable in the hands
of specified employees only . specified employees meaning
Is as follows-
 A director employee of a company.
 Any person who is the employee of the company and he has
substantial interest in the company or he is holding more than
20% voting power in the company.
 Any individual whose salary exceeds Rs. 50,000 after
deduction of section 16(ii & iii).
FOLLOWING ARE PERQUISITES
IN SOME SPECIFIED CASES
 Education Facility - There are two cases of education facility
under the 1st case if the school or institution is owned by the
employer then it is exempted up to 1000 p.m (12000 p.a.) per
child and in the 2nd case if the school or institution is not owned
by the employer then it is fully taxable.
 Gardener, sweeper, watchman and other domestic servant
facilities -
i. If the accommodation is owned by the employee and these
servants have been appointed by the employee too but the
salary is paid by the employer then the actual salary taxable is
in the hands of specified employee.
ii. In this case if the accommodation or house is owned by the
employer and he had paid salary to the gardener then that
amount shall be exempted and salaries of sweeper or any
domestic helper shall be borne by specified employees.
iii. In this case the where the accommodation is not owned by
the employer he has hired it and provided it to the employee
along with the gardener, sweeper, watchman then the salary paid
to these servants shall be fully taxable perquisites in the hands of
specified employees.
 Free gas, electricity and water facilities – When employer
has provided accommodation and gas, electricity and water bill
of that accommodation is also paid by the employer the actual
amount shall be taxable perquisite but only in the hands of
specified employees.
 Free holidays home facilities – If the employees has
maintained holiday homes and during the previous year employee
has avoided the holiday home facility the actual cost by the
employer for providing this facility shall also be taxable
perquisites but only in the hands of specified employees .