Actual expenditure incurred by the employer Less : Sum Calcuated @ Rs.1,200/-Per Month if cubic capacity 1.6 Ltrs. Less : For Driver Rs.600/- Per Month Less : Amount recovered from employee Balancing amount is car perquisites taxable ( Log book to be maintained and to be certify by the employer)
B) Where Car is owned by the Employer / Arranged by the Employer
All Expenses of the Employer Add : 10% of the Actual Cost Less : Recovery Balancing amount is car perquisites taxable
NIL*
Sum Calcuated @ Rs.1,200/-Per Month if cubic capacity 1.6 Ltrs. For Driver Rs.600/- Per Month ( Not necessary to maintanied the log book)
* Conditions to be satisfied if the Car is used for official purpose :-
1. The employer has maintained complete details of journey undertaken for offcial purpose which may include date of journey, destination, mileage, and the amount of exepnditure incurred thereon.
2. The employer gives a certificate to the effect that the expenditure was incurred wholly and exclusively for the performance of official duties
Note : 1. The priciple of Arms length price will apply while cars taken from related parties. 2. If more than on car is provided, one car would be traeted as for personal purposes. 3. Car facility between office and residence - not treated as amenity / benefit and accordingly not a perquisites. 4. Content of log book - complete details of the journey such as date of journey . destination, mileage and amount of the expenditure incurred.
CAclubindia
