FBT

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shannu (Querist)
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21 July 2010 Dear Sirs,
Below mentioned extract claims that FBT is abolished.
My query is " In a case study where an employer is availing insurance for his employees under Employer-Employee Scheme,previously the employee has to bear FBT under section 17(2) of the Income-tax Act .
Whether the CBDT announcement holds for the above mentioned case also?"
I will be very thankful if you can clarify on the same.
With Regards,
Shannu
shannubirla@yahoo.in

Mumbai: The Central Board of Direct Taxes (CBDT) on Friday said any fringe benefit tax (FBT) paid in advance by companies or individuals in 2009-10 will be adjusted against tax liability for the year.
The government had abolished FBT in the full Budget for 2009-10, presented on July 6.
“Any installment of advance tax paid in respect to fringe benefits for assessment year (AY) 2010-11 (financial year 2009-11) shall be treated as advance income tax paid by assessee for the AY,” the CBDT said.
As a result, companies or any other tax payer, who has paid FBT, can adjust such sum against its advance tax obligation in respect of income for financial year 2009-10.
CBDT said, “The unadjusted amount, if any, may be claimed as refund in the return of income for AY 2010-11 to be filed later this year.” This will benefit employees too, especially those who had to partially or fully pay the FBT from their incentive amount. “The employees can write to their employer and claim their portion of the refund, if they had been asked to share the FBT burden,” said Mumbai-based chartered accountant Mehul Sheth.

shannu

shannu (Querist)
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21 July 2010 will be grateful if get a reply to shannubirla@yahoo.in