{"id":10240,"date":"2026-04-13T16:38:22","date_gmt":"2026-04-13T11:08:22","guid":{"rendered":"https:\/\/www.goseeko.com\/blog\/?p=10240"},"modified":"2026-04-17T23:43:30","modified_gmt":"2026-04-17T18:13:30","slug":"perquisites","status":"publish","type":"post","link":"https:\/\/www.goseeko.com\/blog\/perquisites\/","title":{"rendered":"Perquisites"},"content":{"rendered":"\n

What are perquisites?<\/h1>\n\n\n\n

Perquisites are facilities provided to an employee instead of money from an employer for official or personal benefits.<\/strong><\/p>\n\n\n\n

The word \u2018Perquisites\u2019 in the ordinary sense means any casual emolument attached to an office. Or position in addition to salary or wages. It may take various forms. It is a gain or profit which incidentally arises from employment in addition to regular salary or wages. A perquisite is something which arises by reason of a personal advantage. <\/p>\n\n\n\n

Under the general law, benefit which is not convertible into money is treated as a perquisite. Rent free accommodation and free educational facilities for children provided by the employer are examples of benefits not convertible into money as they are not saleable. But the income-tax law does not recognize such a distinction. For income-tax purposes, it is immaterial whether perquisites are voluntary or obligatory. Perquisites are to be discussed in 3 parts: https:\/\/rhbassociation.org\/<\/a><\/p>\n\n\n\n

\"Categories
Categories of perquisites<\/figcaption><\/figure>\n\n\n\n
    \n
  1. Perquisites taxable for all Employees.<\/strong><\/li>\n\n\n\n
  2. Perquisites taxable for Specific Employees.<\/strong><\/li>\n\n\n\n
  3. Perquisites which are Exempt.<\/strong> https:\/\/www.paisabazaar.com\/salary\/perquisites\/<\/a><\/li>\n<\/ol>\n\n\n\n

    Perquisites taxable for all Employees<\/strong><\/h2>\n\n\n\n

    The following perquisites are taxable in the hands of all employees:<\/p>\n\n\n\n

      \n
    1. Rent free accommodation<\/strong> provided by the employer to the employee. Such accommodation may be furnished or unfurnished.<\/li>\n\n\n\n
    2. Any concession<\/strong> in the matter of rent <\/strong>in respect of the accommodation provided or granted by the employer to the employee.<\/li>\n\n\n\n
    3. Any sum paid by the employer in discharging the monetary obligation<\/strong> of the employee which otherwise would have been payable by the employee e.g. the school fees of the children of the employee paid by the employer or the Income-tax of the employee paid by the employer.<\/li>\n\n\n\n
    4. Any sum payable by the employer whether directly or through a fund (other than recognized provident fund (RPF), Approved Superannuation Fund or Deposit Linked Insurance Fund) to effect an assurance on the life of the assessee<\/strong> or to effect a contract for an annuity.<\/strong><\/li>\n\n\n\n
    5. The value of any other fringe benefit<\/strong> or amenity as may be prescribed.<\/li>\n\n\n\n
    6. Specified security or sweat equity shares<\/strong> allotted or transferred by the employer to the assessee.<\/li>\n\n\n\n
    7. Contribution by the employer to the approved superannuation fund<\/strong> in respect of assessee to the extent it exceeds Rs. 1,50,000.<\/li>\n<\/ol>\n\n\n\n

      Perquisites taxable for Specified Employees<\/strong><\/h2>\n\n\n\n

      All monetary obligations of the employee discharged by the employer are perquisites which are taxable in the hands of all employees. But sometimes the employer, instead of making the payment in respect of such monetary obligations or reimbursing such amount to the employee, provides the perquisite in the form of a facility to the employee. Such facility will be a perquisite only for specified employees mentioned in section 17(2)(iii).<\/p>\n\n\n\n

      For example:<\/strong><\/p>\n\n\n\n

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      1. if a watchman\/sweeper is engaged by the employee and his wages are reimbursed\/paid by the employer, it is a perquisite for all employees because it is the duty of the employee to pay the salary of his watchman\/sweeper.<\/li>\n\n\n\n
      2. On the other hand, if the watchman\/sweeper is engaged by the employer and facility of his services is provided to the employee, it will be a perquisite only for specified employees.<\/li>\n\n\n\n
      3. Similarly, if a motor car is provided by the employer to the employee for his personal use it shall be taxable perquisite in case of a specified employee only. Whereas if the car belongs to employee but expenses relating to personal use of such car are paid or reimbursed by the employer, it shall be a taxable perquisites in the hands of all employees, whether specified or not.<\/li>\n\n\n\n
      4. Any benefit\/amenity in the form of a facility (other than rent free accommodation, concession in the matter of rent or fringe benefits or amenities as may be prescribed) provided by the employer, which is not tax-free, shall be taxable only in the hands of specified employees. Some of these are:<\/li>\n<\/ol>\n\n\n\n
          \n
        1. services of a sweeper, gardener, watchman or personal attendant,\n
            \n
          1. free or concessional use of gas, electric energy and water for household consumption,<\/li>\n\n\n\n
          2. free or concessional educational facilities,<\/li>\n\n\n\n
          3. use of motor car,<\/li>\n\n\n\n
          4. personal or private journey provided free of cost or at concessional rate to an employee or member of his household,<\/li>\n\n\n\n
          5. the value of any other benefit or amenity, service, right or privilege provided by the employer.<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n\n\n\n