Salary & Income · Section 13 · Tax Year 2026-2027 slabs
Perquisites Tax Calculator
Company house, company car, subsidised loan — all salary in your hands, and all valued by rule rather than by what they are worth to you. See the taxable value and the tax it adds.
Reference
How each benefit is valued
| Benefit | Taxable value | Watch for |
|---|---|---|
| Accommodation | Rent that would have been paid, subject to a floor of about 45% of basic or the minimum of the time scale | The floor applies even where market rent is lower |
| Vehicle, partly personal | About 5% of the cost to the employer | Cost at acquisition, not current value |
| Vehicle, wholly personal | About 10% of the cost to the employer | Double the partly-personal charge |
| Concessional or interest-free loan | Benchmark rate less the rate charged, on the loan | A cut-off, not a slice — small loans are outside it entirely |
| Utilities, servants, club fees | Cost to the employer | Enter under other perquisites |
| Medical under the terms of employment | Exempt within limits | Only the taxable excess is entered |
The valuation rule, not your sense of the benefit's worth, decides the tax. A car you rarely drive is still valued on its cost.
Reading the result
Valued by rule, not by what it cost
The taxable value of a benefit is set by the rules, not by what your employer paid or what you think it is worth. That cuts both ways: a modest car can be valued above what you would have spent yourself, and generous accommodation can be valued below its market rent.
Arguing that you did not want the benefit, or would not have bought it, does not change the valuation. Once provided, it is salary.
Cash in lieu is worth comparing
Because the rules value benefits independently of cost, a package offering a car or an allowance instead is a genuine calculation rather than a preference. Sometimes the allowance is taxed more lightly than the benefit; sometimes the reverse. It is one of the few places where asking the employer to restructure an offer can leave you measurably better off at no cost to them.
A cheap loan is a benefit too
An interest-free or subsidised loan from an employer is taxed on the value of the concession, not on the loan itself. Employees who treat a staff loan as neutral are sometimes surprised when it shows on the tax computation.
Where this stops
This values the perquisites it covers by the prescribed method. Medical benefits, and benefits provided under specific approved schemes, have their own treatment and are not all taxable in the same way.
FAQs
Perquisites FAQs
What is a perquisite?
Anything of value your employer provides on top of cash salary — a house, a car, a subsidised loan, utilities, a servant, club fees. The law treats these as salary in your hands and taxes them, because otherwise every employer would simply pay in kind. What makes them awkward is that the taxable value is set by rule, and the rule often differs from what the benefit is worth to you.
How is employer-provided accommodation valued?
At the amount that would have been paid had the employer not provided it — in practice the market rent — subject to a floor, commonly applied at 45% of the minimum of the time scale or the basic salary. The floor is the part that surprises people: a modest flat in a cheap area is still valued at the floor if market rent is lower, so the taxable value can exceed the real benefit.
How is a company car valued?
On the cost of the vehicle to the employer, not on your usage log. A vehicle partly for personal use is commonly valued at 5% of cost, and one wholly for personal use at 10%. Both figures are editable above, and the distinction matters more than people expect — it doubles the charge.
Is a loan from my employer taxable?
Section 13(7): where an employer loan carries no profit, or profit below the benchmark rate, the shortfall on the whole loan is taxed as salary. The benchmark rate is capped at 10% per annum. The second proviso keeps loans not exceeding Rs 1,000,000 outside the rule altogether — a cut-off, not an exemption slice — so a Rs 1,000,001 loan is taxed on all of it.
Do medical benefits count?
Medical treatment or reimbursement provided under the terms of employment is exempt within limits, with a commonly applied ceiling expressed as a percentage of basic salary where no hospital facility is provided. Only the taxable excess belongs in the other-perquisites field above.
Why does my tax rise by more than the value of the benefit?
It does not — but it can feel that way. Perquisites stack on top of your cash salary, so they are taxed at your top rate rather than your average one, and a large benefit can push part of your income into the next band. The panel shows the extra tax separately for exactly this reason.
Can I refuse the benefit and take cash?
That is a negotiation, not a tax question, but the arithmetic is worth doing before you negotiate. A car valued at 10% of a high cost price can be worth less to you than the cash equivalent after tax, while subsidised accommodation in an expensive city is usually worth keeping. Run both and compare.
Is this what my employer will actually deduct?
Your employer values perquisites under the same rules and withholds monthly on the total. Differences usually come from the basic-salary figure used for the accommodation floor, or from a vehicle treated as partly rather than wholly personal. If your payslip disagrees with this page, that is where to look first.
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