According to the notification, changes have been made in the provisions of the facilities provided by the employers to the employees to stay without rent. Overall, there will be less reduction in the total salary of the employees.
Salary of such employees will increase.
The Income Tax Department has given great relief to lakhs of salaried taxpayers and employees. The Central Board of Direct Taxes (CBDT) has issued notifications regarding some changes in the rules related to rent-free homes.
After the implementation of the new rule, there will be an increase in the take home i.e. in hand salary of the employees. In the notification issued on Saturday, CBDT said regarding the Rent Free Home given to the employees that the new changes will be implemented from next month.
Employees will be able to save more
According to the notification, changes have been made in the provisions of the facilities provided by the employers to the employees to stay without rent. Such employees, who have been given the facility of rent-free house by the employers, will now be able to save more than before. Because his take home salary is going to increase. The new provisions are coming into effect from September 1, 2023.
Valuation will change
Apart from the Central and State Government employees, in cases where they are provided with unfurnished accommodation. Their ownership rests with the employer. There will be a change in valuation after the rules are implemented.
10 per cent of the salary in cities with a population of more than 40 lakhs as per the 2011 census. 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.
As per 2011 census, equal to 7.5 per cent of salary in cities with population less than 40 lakhs but more than 15 lakhs. Earlier it was 10 per cent in cities with population of 10 to 25 lakhs based on 2001 population. On the basis of this new valuation, the in-hand salary of the employees will increase.
How will the employees benefit?
Now let us understand in easy language how the employees can get the benefit of this change. Suppose an employee is living in a house provided by the employer. The calculation for that will now be done under the new formula. Because the rate has been reduced. That is, there will be less deduction from the total salary, due to which the in-hand salary of the employees will increase every month.
Experts say that after the implementation of the new rule, where on one hand there will be savings for the employees. On the other hand, there may be a decrease in the revenue of the government. Employees with high income will benefit more from this, who get more expensive housing.