Income tax
The Central Board of Direct Taxes (CBDT) issued a new notification, which will provide direct relief to millions of salary taxpayers. This notification has been brought in the Income Tax Rules, 1962 through two new rules 3C and 3D. This change will be applicable from 1 April 2025 and will show its effect from Assessment Year 2026-27.
Previously, if an employee had more than Rs 50,000 per annum (except for the monetary salary, ie allowances), they had to pay tax on many facilities from the implair. Now this limit has been increased to Rs 4 lakh. Also, tax-free limit on foreign medical treatment has been increased from 2 lakh to 8 lakh rupees.
Who is taxed?
When an implear gives some special facilities to his employee apart from salary, such as car, watchman, gardener, electricity-water or free education of children. These are called “Perks”. According to Section 17 (2) (III) of the Income Tax Act, these perks are taxable for some employees.
This tax is only on specified workers, its employee who is the director of the company, or who has 20% or more voting power in the company, or whose annual salary is more than Rs 4 lakh (now instead of the earlier 50,000).
What will be the benefit of the common employee?
Now if an employee’s salary is less than Rs 4 lakh and he gets facilities like car, electricity-water, gardner, watchman or children’s education, then he will not have to pay any tax. That is, earlier people who used to pay tax on these facilities due to the limit of 50,000, now they will get direct discount. For example, if an employee’s salary is Rs 3.99 lakh and his implear is imparting free education to his children, then no tax will be levied on this facility.
Big relief on treatment abroad
Not only salary, if an employee is sent abroad for the treatment of himself or family member and the company bears it, then earlier only up to Rs 2 lakh was considered tax-free. Now this limit has been increased to Rs 8 lakh, this means, even if you get more help in times of need, there will be no tax burden.