Vehicle · perquisite
Company car
A car provided by the employer is valued at prescribed monthly rates, not at its actual cost.
How the taxable value is determined
₹1,800/month up to 1600cc and ₹2,400/month above, plus ₹900/month where a driver is provided, when the employer bears running costs. Nil if used wholly for official duties with proper records.
Regime availability
- Old regime
- Prescribed value applies
- New regime
- Prescribed value applies
Documentation to keep
Logbook of official journeys and employer certification where nil value is claimed.
Legal basis: Rule 3(2), Income-tax Rules
Frequently asked questions
Is company car taxable in India?
A car provided by the employer is valued at prescribed monthly rates, not at its actual cost. ₹1,800/month up to 1600cc and ₹2,400/month above, plus ₹900/month where a driver is provided, when the employer bears running costs. Nil if used wholly for official duties with proper records.
Does the exemption apply under the new tax regime?
Under the old regime this treatment is not applicable — the value is prescribed, not exempted; under the new regime it is not applicable — the value is prescribed, not exempted. Legal basis: Rule 3(2), Income-tax Rules.
What records should I keep for company car?
Logbook of official journeys and employer certification where nil value is claimed.
Related tools & guides
Reflects provisions in force for FY 2026-27; verify against the latest government publications (incometax.gov.in). Information, not tax advice.