Perquisite
A non-cash benefit or facility an employer provides to an employee, such as rent-free accommodation or a company car, taxed as part of salary based on a specified valuation method.
A perquisite is any benefit or facility, beyond cash salary, that an employer provides to an employee because of their employment: rent-free or concessional accommodation, a company car available for personal use, interest-free or concessional loans, employer-paid club memberships, and several others. Most perquisites are taxable, valued using specific rules prescribed under the Income Tax Rules for each category rather than simply the employer's actual cost.
Some perquisites are wholly or partly exempt, such as specified medical benefits or reimbursements within prescribed limits. Because perquisite valuation rules are detailed and category-specific, they're a common source of confusion in salary structuring, and getting the valuation wrong understates taxable salary in a way that can surface later as a mismatch.
This glossary entry is for general informational purposes only and does not constitute professional tax, legal, or financial advice. Rules and rates change, so consult a qualified Chartered Accountant for advice specific to your situation.