What is Imputed Income?

Imputed income refers to the value of non-cash benefits or extra perks employees regularly receive that are not considered a part of their basic salaries. These benefits have a monetary value and, so, can be regarded as part of the individual’s income for tax purposes, even though the individual does not receive this compensation in the form of cash.

Paying for the benefits is not necessarily an employee’s mandate. However, they are responsible for the tax deductions applicable.