Punjab National Bank (PNB) has finally declared to absorb 100% Tax on Perquisites. PNB has released an official circular regarding the same. Earlier, a few weeks ago, PNB MD&CEO, in a meeting, had announced the decision of the bank to absorb 100% Tax on Perquisites. Earlier, PNB was paying only 50% Tax on Perquisites, and employees had to pay 50% Tax.
Perquisites are benefits given to bank employees, such as interest-free loans or loans at very low interest rates. Bank employees receive car loans and other loans at lower rates compared to the general public. The court has now ordered banks to apply tax on these perquisites. This was one of the major benefits for bank employees, but after the court’s order, this advantage will no longer remain as beneficial.
Now, PNB will bear 100% of the TDS liability on perquisite value of interest free loans & loans at concessional rate of interest for FY 2025-2026. But this is not permanent. The decision on continuation or modification of this relief in future years shall be reviewed depending on the Bank’s operating profit and overall financial position.
TDS on Salary & Perquisites
📢 As per the circular issued by the Finance Department on 21.09.2024, Tax Deduction at Source (TDS) has been implemented on Salary and various Perquisites for FY 2024-25.
🏦 Accordingly, TDS is being deducted by the Bank on these loans and other perquisites from 01.04.2024, with the first deduction starting from the salary of January 2025.
💡 Taking into account the financial difficulties of the employees, the Bank has decided to bear 100% of the TDS liability applicable on interest-free loans/loans given at concessional rates for FY 2024-25.
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