When an employer provides a car or any other vehicle for the private use of the employee or any other member of his family, it is a perquisite which is taxable in the hands of the employee

The nature of ownership of the vehicle and the manner of use of the car is of prime importance.

Note:

1. For Car (owned by employee) used for only Official purposes, the employer needs to maintain complete details of journey (log book): date of journey, destination, mileage, and the amount spent. Also the employer gives a certificate the expenditure was incurred fully and exclusively for official work
2. Use of employer owned car to travel from residence to work and back is not a taxable perquisites
3. Where the employee has a automotive conveyance but the actual running and maintenance expenses are met or reimbursed by the employer

(i) Employee‘s conveyances is being used only for official purposes : No value to be taxed but a proper log book with all required details is required to be maintained.

(ii) Employee‘s conveyance used partly for official purposes and partly for personal or private purposes of the employee.  : Taxable value of the perk shall be the actual amount of expenditure incurred by the employer as reduced by the amount of 900 p.m. or a higher sum for official purposes subject to certain conditions