Perquisites are considered as a very important element of Income from Salary. One of the important perquisites given to employees is Rent-free Accommodation (RFA). It means a place of residence that the employer gives to an employee to stay in. RFA can be given either free of cost or at a concessional rate. 

Rent Free Accommodation

Term Accommodation

A Flat

Hotel

Farm House

Service Apartment

Caravan

Ship

Mobile Home

Guest House

Rent Free Accommodation Is Of Two Types

Rent Free Accommodation Is Of Two Types

Unfurnished Accommodation 

The income tax imposed is 10% of the employee's wage minus the employee's rent paid to the employer. Workers who live and work in cities with populations more than 10 lakhs but less than 25 lakhs.

Furnished Accommodation 

The rental fee or the leasing fee whether the furniture is rented or leased..A loss of 10% on furniture or appliances whether it is owned by the boss.