Ravi receives ₹25000p.m.as basic salary from ABC Ltd. He is provided accommodation which is taken on rent in delhi ( population 25lakh) . The employer has charged rent of ₹ 4000p.m.from Ravi . The taxable value of concessional accommodation will be?

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Answer

Calculation of Taxable Value of Concessional Accommodation for Ravi

Basic Salary
- Ravi receives ₹25000 per month as basic salary from ABC Ltd.

Accommodation
- Ravi is provided accommodation by ABC Ltd. which is taken on rent in Delhi (population 25 lakh).
- The employer has charged rent of ₹4000 per month from Ravi.

Taxable Value of Concessional Accommodation
- As per the Income Tax Act, concessional accommodation provided by the employer to an employee is considered a taxable perquisite.
- The value of such accommodation is calculated as follows:
- If the accommodation is owned by the employer - 15% of the employee's salary in cities with a population exceeding 25 lakh.
- If the accommodation is taken on lease or rent - Actual amount of rent paid by the employer minus rent paid by the employee.
- In this case, since the accommodation is taken on rent by the employer, the taxable value of concessional accommodation will be:
- Actual amount of rent paid by the employer - ₹4000 (rent paid by Ravi).
- Let's assume that the actual rent paid by the employer is ₹10000 per month.
- Taxable value of concessional accommodation = ₹10000 - ₹4000 = ₹6000 per month.

Therefore, the taxable value of concessional accommodation for Ravi is ₹6000 per month.

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