Motor Car Facility perquisite

A car provided by your employer is a taxable perquisite. How much is taxable depends on who owns the car, whether it is used officially, privately or both, and who pays the running costs. For mixed use the law uses fixed monthly amounts based on engine size, with ₹900/month extra if a driver is provided.

1. Used only for official duties → nil (exempt).
2. Employer’s car, both uses, employer pays running costs → ₹1,800/month (≤ 1.6 L) or ₹2,400/month (> 1.6 L), + ₹900 for a driver.
3. Employer’s car, both uses, employee pays running costs → ₹600/month (≤ 1.6 L) or ₹900/month (> 1.6 L), + ₹900 for a driver.
4. Employer’s car, private use → wear & tear (10% of cost ÷ 12) + running expenses − amount recovered.
5. Employee’s car, both uses, employer pays → actual expenditure − the deemed personal value − amount recovered.

Employer’s car over 1.6 litres, used both officially and privately, employer bears the cost, a driver is provided.

1. Base = ₹2,400/month (> 1.6 L).
2. Driver = ₹900/month.

Taxable perquisite = ₹3,300 per month.

No. If it is used only for official duties there is no perquisite. Private or mixed use is taxable.

₹900 per month, on top of the ₹1,800 / ₹2,400 car value for mixed use.