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15% of salary; Any charges recovered from the employee shall be deducted. Value calculated will be increased by 10% p.a. of the cost of furniture if owned by the employer or Actual hire charges payable in case the furniture is taken on hire. Any charges recovered from the employee shall be deducted.
Housing ? or housing allowances ? provided as a fringe benefit is taxable and subject to withholding, just like regular income tax. This amount will need to be added to the employee's W-2 form in box 1. Any additional fringe benefits can be added there as well.
If an employer (Government or non-Government) provides hotel accommodation to an employee on his posting to another place, it will not be considered taxable if the employee's stay in the hotel is up to 15 days during the year.
As per the Income Tax Act, 1961 if an employer provides residential accommodation to its employees free of cost or at concessional rates, the value of such benefit is taxable as perquisite in the hands of employees.
Thus, the perquisite varies as follows: For cities above 25 lakh residents, 15% of your salary will be valued as the perquisite. In cities that hold a population of more than 10 lakh but less than 25 lakh, the perquisite would be 10% of your salary.