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Exemption on company leased accomodation

Ravi Agarwal (IT & Systems) (39 Points)

25 June 2013

Whether a company providing "company leased accomodation" to an employee with gross salary of Rs. 30,000/- p.m. (HRA component is Rs. 1500/-) at the rate of Rs. 12,000/- per month is correct in counting the total taxable oncome as Rs. 42,000/- per month?

Should the employee get an exemption atleast on HRA of Rs. 1500/- p.m. which is deducted in lieu of leased accomodation?

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5 Replies

(Guest)

Please Clarify, Correct me if I am wrong,

Company is providing leased accomodation to employee and also paying HRA to the same employee.

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Ravi Agarwal (IT & Systems) (39 Points)
Replied 26 June 2013

No, HRA is not provided, but counted in gross salary and later shown as deducted in net salary.

(Guest)

when HRA is not provided how can it be counted in gross salary

Ravi Agarwal (IT & Systems) (39 Points)
Replied 26 June 2013

Yes that is 1 question.

and 2nd question is whether employee who is not in receipt of any cash for the leased accomodation should pay tax on the full amount of lease value OR should get exemption to some extent like 10% of the salary etc.

(Guest)

there is calculation under the law, called Rent Free Accomodation.

The amount will be calculated as per Rule 3

which is: Actual amount of lease rental paid or payable by the employer or 15% of salary whichever is lower as reduced by the rent, if any, actually paid by the employee.