Accountancy Forum - Definition of Self-hiring

Anybody can define this?

Self-hiring - When an employee gives on rent any building (house/flat/apartment, etc.) owned by him or any of his/her family member(s) to his/her employer and the employer provides the same against the employees entitlement for a rent-free accommodation or housing, it results into

Provision of a perquisite (rent free accommodation or housing) by the employer to the employee chargeable as income from 'salary' and
Receipt of rent of land or building by the employee or any of his/her family members, as the case may be, chargeable as income from 'property' in the hands of the owner.

Dear it is practice in government organizations that employees hire their own properties or properties registered in the names of their family members in order to get amount of hiring or leasing or house rent. This practice is termed as self hiring. We found self hiring in government organization but it is rarely found in private organization.

In self hiring the amount of rentals received by employee or his family member shall be treated as "Income from Property" . Note it whether the amount of rent is received by employee for property, registered in his name, or whether it is received by his any family member it will be treated as income from property of employee. The amount of rentals shall be chargeable to tax as per rate specified in Division VI of First Schedule of ITO,2001.

Dear,

If an employee has rented out his own (or his family membersâ) property to the employer and employer has provided the same to the same employee (Letâs suppose, A is an employee and B is his employer, A rented his house to B and B provided the same to A). This transaction will have two fold effects, first, this will be treated as a rent free accommodation to employee on behalf of employer and fair market value of rent will be added to the taxable income of the employee under the head Salary, since this is to be treated as a perquisite to employee.

Second, Value of fair market rent, during a specified year, will be taxable to employee (landlord) under the head âIncome from Propertyâ.

Should still any confusion exists, let me know.

Best Regards,

Faisal.

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by faisal_desperado
 Dear,

If an employee has rented out his own (or his family membersâ) property to the employer and employer has provided the same to the same employee (Letâs suppose, A is an employee and B is his employer, A rented his house to B and B provided the same to A). This transaction will have two fold effects, first, this will be treated as a rent free accommodation to employee on behalf of employer and fair market value of rent will be added to the taxable income of the employee under the head Salary, since this is to be treated as a perquisite to employee.

Second, Value of fair market rent, during a specified year, will be taxable to employee (landlord) under the head âIncome from Propertyâ.

Should still any confusion exists, let me know.

Best Regards,

Faisal.

<hr height="1" noshade id="quote"></blockquote id="quote">

It mean if the Rent amount is paid to the (A)landlord it will be consider Income from Property & if the the rent is not paying then fair market value of rent will be determined & added to the head SALARY.

yes

Thansk to All for your kind support

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by smimranhaider
It mean if the Rent amount is paid to the (A)landlord it will be consider Income from Property & if the the rent is not paying then fair market value of rent will be determined & added to the head SALARY.

<hr height="1" noshade id="quote"></blockquote id="quote">

No Dear, You could not understand my last post probably, I would request you to go through the same again.

Rent paid to landlord will be treated as landlordâs property income on the one hand and it will also be treated as a perquisite from employer to employee (i.e. landlord) and accordingly will be added to the salary income of that employee (Landlord).

Let me know, if it requires further clarification.

Regards,

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by faisal_desperado
 <blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by smimranhaider
It mean if the Rent amount is paid to the (A)landlord it will be consider Income from Property & if the the rent is not paying then fair market value of rent will be determined & added to the head SALARY.

<hr height="1" noshade id="quote"></blockquote id="quote">

No Dear, You could not understand my last post probably, I would request you to go through the same again.

Rent paid to landlord will be treated as landlordâs property income on the one hand and it will also be treated as a perquisite from employer to employee (i.e. landlord) and accordingly will be added to the salary income of that employee (Landlord).

Let me know, if it requires further clarification.

Regards,

<hr height="1" noshade id="quote"></blockquote id="quote">

Dear Sir,
Stil not clear, If the employee is paid Rs 25,000 p/m by employer for helf hiring then 25,000 X 12 = 300,000 will be his perquisite & added in his salary income. Same will be consider employee's property income in this condition employee will pay double tax on Rs 300,000 one on Property Income & 2nd on Salary income.

Can you please clear my point of view.

i bilkul,, 300000 us ki property income hay is liye wo is par Tax day ga,,,,
or 300,000/= is ki salary income may add ho jayen gay, yani agar us ki salary 500000 hay to us ki salary income 800,000 ho jaye gi or wo 800000 par income tax day ga, sath sath 300000 property income par bhi income tax day ga.

<blockquote id="quote">quote<hr height="1" noshade id="quote">Originally posted by LapTop
 i bilkul,, 300000 us ki property income hay is liye wo is par Tax day ga,,,,
or 300,000/= is ki salary income may add ho jayen gay, yani agar us ki salary 500000 hay to us ki salary income 800,000 ho jaye gi or wo 800000 par income tax day ga, sath sath 300000 property income par bhi income tax day ga.
<hr height="1" noshade id="quote"></blockquote id="quote">
To Self Hiring se employee ko kiya fayeda howa ye to ulta loss hoqa na us ne 2 dafa tax pay kiya ek hai income pe.

JI Bilkul,,,,
may to is may kuch nahi kar sakta na ji,,, yehi kanoon hay Income Tax ka.