Hi!

A company transferred the employee from Chennai to Bombay. The employee incurred expenses on shifting to Bombay which the company reimbursed.

Had the FBT not been abolished it would have been liable to FBT. I am confused whether this is a perquisite? and taxable in the hands of the employee?

Please clarify.Its urgent

General understanding does not allow this expenses to add in perquisite... let others too reply on same

Originally posted by : Priyadarshini
	Hi! A company transferred the employee from Chennai to Bombay. The employee incurred expenses on shifting to Bombay which the company reimbursed. Had the FBT not been abolished it would have been liable to FBT. I am confused whether this is a perquisite? and taxable in the hands of the employee? Please clarify.Its urgent

the co. is liable to pay expenses so it is covered under perqusities because the co. is not giving regular facility, it is the one time expenses so it will be treated as perqusities

Originally posted by : Priyadarshini
	the co. is liable to pay expenses so it is covered under perqusities because the co. is not giving regular facility, it is the one time expenses so it will be treated as perqusities

the co. is liable to pay expenses so it is covered under perqusities because the co. is not giving regular facility, it is the one time expenses so it will be treated as perqusities

m i right ???????

But this expenditure is incurred bcos of transfer by the employer.it is in relation to employment only....So how can the employee be liable to pay tax?It is a REIMBURSEMENT only no?that too related to employment.

See section 10(14).. the amount paid will be exempt..

Any allowance (by whatever name called) granted to meet the cost of travel on tour or on transfer (including any sum paid in connection with transfer, packing and transportation of personal effects on such transfer will be exempt under Section 10(14).

This exemption is dependent on the amount of expenditure incurred. Hence, if the person has received compensation of 40K and has spent 30k only then 30K will be exempt. Ofcourse if he has spent 41K then exemption will be restricted to 40K only.

Total thanks : 1 times

jayesh is right, the amount is a part of exempted salary.

thanks jayesh..Reading Rule 2BB with 10(14) it is exempt..

 yes it is exempt U/S 10(14).