Rent-Free Accommodation: The Income Tax Department has laid down the rules related to rent free accommodation given to the employees by the company …
If you are employed then there is good news for you. In fact, the Income Tax Department has given relief to the people by making major changes in the rules related to rent free accommodation. The rules of Rent-Free Accommodation given to the employees by the company have been changed.
The Central Board of Direct Taxes (CBDT) has issued a notification regarding this. After the change in rules, employees will now be able to save more. The in hand salary of the employees will increase. Changes in the rules related to rent-free accommodation have come into effect from September 1.
Calculation will be done under the new formula.
To put the new rules in simple language, if an employee is living in a house provided by the company, then the calculation for him will now be done under the new formula.
According to the notification, employees other than central or state government employees, who live in company-owned houses. The evaluation of their valuation has now been changed. According to the new rule, where the employees are given home (unfurnished) by the company. The ownership of such accommodation is with the company itself.
Its valuation will now be in a different way. Now the urban area whose population is more than 40 lakhs according to the 2011 census, then there will be 10% of HR salary. Earlier it was equal to 15 per cent of the salary in cities with a population of 2.5 million as per the 2001 census.
