Finally there is clarity on valuation of perquisites provided by employers to employees, as notified by the Central Board of Direct Taxes on 18 Dec 09 , through introduction of new  norms  called the Income Tax (Thirteenth Amendment Rules) 2009.

The new norms will come into effect with retrospective basis from April 1, 2009. The finance bill presented this year had abolished FBT and perks had become taxable in the hands of the employees. However norms were yet to be introduced on how to value the perquisites.

In the new regime, the value as calculated based on the new norms notified, will be added to the total income of the employee and will be taxed depending on the tax bracket that the employee falls under.

(To view different tax brackets, refer to our blog article dated 21 July 09 (http://www.evetan.com/blog/2009/07/21/budget-2009-10-impact-on-payroll/)

The perquisites that become taxable in the hands of the employees now; include cars, rent free accommodation, services of personal attendant, interests free loans, gift vouchers, employee stock options etc.

For a complete list of taxable perquisites and how to value them, visit: http://www.itatindia.com/datafolder/flash/Flashst19-12-09_1.htm

Team eVetan