For tax purposes, the accommodation provided by the company is treated as a ‘perquisite’ in the hands of employee and is considered to be a part of her taxable salary. The value of such accommodation is calculated as 15% of the salary or actual rent paid by the employer, whichever is lower.
Is housing allowance taxable in Kenya?
With this in mind, that amount of money you give your employees as house allowance is considered as either a gain or a profit of employment. It is hence taxable as part of the employees income. Please note that for many years in Kenya, the house allowance has been calculated as 15% of the employee’s basic salary.
What is the value of rent free accommodation?
Rent Free Accommodation – Leased by Employer In case of rent-free accommodation provided to an employee, wherein the employer has taken the property on lease or rent, the value of the perquisite would be the actual amount of lease or rental paid or 15% of the salary, whichever is lower.
When does an employer need to provide housing?
10/2014. Employers may provide housing to employees for a variety of reasons, including not-for-profit organizations that maintain institutions of higher education, historic sites, housing facilities, and other premises that require on-site staff.
When is employee housing is taxable to the employee?
Depending on the circumstances, certain housing and subsistence benefits can be taxable to the employee, and sometimes these benefits can be a deductible business expense for your company. Several kinds of housing arrangements for employees include: Employer paying for the housing of employee’s choice, often using a housing allowance.
What are the different types of housing arrangements for employees?
Several kinds of housing arrangements for employees include: Employer paying for the housing of employee’s choice, often using a housing allowance. Employer-provided housing for employees at a specific location. Temporary lodging for employees while they travel on company business.
Are there exceptions for housing provided by an employer?
The exceptions cover housing located on the employer’s premises; housing for the clergy; housing for faculty members of an educational institution; and housing your employer provides when you relocate temporarily.
