Perquisite values changed in 2026: car from Rs 1,800 to Rs 5,000, meals from Rs 50 to Rs 200

Salary is not only salary. A company house, a company car, meal cards, children's school fees, an interest-free loan — these are all perquisites, and each carries a valuation that is added to your taxable income.

Those valuations changed on 1 April 2026. Some of them dramatically.

And the internet is confidently wrong on this subject. On rent-free accommodation rates I checked three top-ranking sites — all three gave different tables, and all three were of the old structure. So this guide carries only figures verified against two independent professional sources, and where there is ambiguity it says so.

# First, get the timing straight

So today's filing is unaffected. The new values apply to this year's salary, and the difference will show in your next Form 16. But CTC restructuring and salary negotiation are happening now — which is why these numbers matter today.

# Company car — the biggest jump

Now the arithmetic. A small car with a driver:

• Before: (1,800 + 900) × 12 = ₹32,400 a year
• Now: (5,000 + 3,000) × 12 = ₹96,000 a year

At a 30% slab that is roughly ₹19,840 of additional tax each year.

# Meals — this one works in your favour

• ₹200 per meal exempt (previously ₹50) — four times
• During working hours, through non-transferable electronic vouchers
• Tea and snacks are separately and fully exempt

Counting two meals per working day, that is over ₹1 lakh a year tax-free. It is now a meaningful CTC component rather than a symbolic one.

# Gifts — ₹5,000 to ₹15,000

• Aggregate value of gifts, vouchers and tokens for the year up to ₹15,000 — value nil
• Above that — the entire value is taxable, not just the excess

This is a cliff, not a slope. A ₹15,000 gift is nil. A ₹15,100 gift is ₹15,100 taxable. Worth remembering when setting a Diwali gifting policy — stopping at ₹15,000 and going to ₹15,100 are not the same cost.

And a cash gift is fully taxable in every case, even ₹500.

# Rent-free accommodation — this did not change

Non-government employees, employer-owned accommodation:

This has applied since September 2023. The 2026 changes did not touch RFA.

For leased or rented accommodation: actual lease rent or 10% of salary, whichever is lower.

# Free education and medical loans

• Free or concessional education at the employer's own institution — threshold ₹3,000 per month per child (previously ₹1,000)
• Loan for treatment of specified diseases from the employer — exempt up to ₹2,00,000, subject to conditions
• Small loans — aggregate up to ₹20,000

Children's education allowance (₹3,000/month/child) and hostel allowance (₹9,000/month/child) are a different thing — those are allowances, not perquisites, with their own story. There is a separate guide on those.

# Interest-free or concessional loans

Where you take a loan from your employer without interest, or below market rate, the difference is a perquisite.

Formula: SBI's lending rate as on 1 April minus interest actually charged to you, on the monthly outstanding balance.

This mechanism did not change.

# And the biggest misconception

# A 15-minute check

1. Ask payroll for Form 12BA — it comes with Form 16, and most people have never seen it
2. Check the car's engine size and who bears the expenses — the difference between ₹5,000 and ₹2,000 turns on that
3. EV means the ₹5,000 bucket — if payroll has applied ₹7,000, that is an error
4. Verify the population bracket for accommodation — employers often default to 10%
5. Is the food allowance in cash or on a card — that single line is now over ₹1 lakh a year
6. Check that gifts in aggregate are not crossing ₹15,000

Written by

Prabhakar Kumar

Chartered Accountant (ICAI, Nov 2019)

Founder of VittSphere Technologies. Practicing CA serving 200+ MSME clients across Pune. 86% win-rate at AO and CIT(A) level tax appeals. Writes on Indian taxation, capital gains, and personal finance.