CBDT amends Income Tax Rules for determination of Value of Perquisite concerning Residential Accommodation:

CBDT amends Income Tax Rules for determination of Value of Perquisite concerning Residential Accommodation The Central Board of Direct Taxes(CBDT) has amended Income Tax Rules for determination of Value of Perquisite concerning Residential Accommodation provided by employer via issuing Notification. The Finance Act of 2023 made a change to the computation of "perquisite" for the value of rent-free accommodation or concessional accommodation granted to an employee by his company. As a result, the CBDT has amended Rule 3 of the Income-tax Rules, 1962 to include this provision. The classification and limits of cities and populations are now based on the 2011 census rather than the 2001 census. The updated population limitations are 40 lakh instead of 25 lakh and 15 lakh instead of 10 lakh. In the modified Rule, the previous perquisite rates of 15%, 10%, and 7.5% of compensation have been decreased to 10%, 7.5%, and 5% of salary, respectively. This is summarised as under: The Rule has also been further rationalised so as to compute a fair tax implication of the same accommodation being occupied by an employee for more than one previous year. To Read More Download Official Notification Given Below: