FBT due on prepaid expenses or not ?
This query is : Resolved
04 October 2007
If we pay Rs. 1 Lac for insurance of car, and we book Rs. 50K as expenses pertaining to current financial year & balance amount of Rs.50K we book as prepaid.
In above case, what will be FBT liability i.e. on Rs. 1 Lac or Rs. 50K, which we have booked as expense.
In above case, what will be FBT liability i.e. on Rs. 1 Lac or Rs. 50K, which we have booked as expense.
04 October 2007
THE CHARGING SECTION FOR FBT 115WA SAYS THE APPLICABILITY OF THE TAX IS ON SATISFYING THE FOLLOWING CONDITIONS:
1.FRINGE BENEFITS ARE PROVIDED BY EMPLOYER
2. THESE BENEFITS ARE PROVEIDED O THE EMPLOYEES.
3.THESE BENEFITS ARE PROVIDED DURING THE PREVIOUS YEAR.
THUS WHAT THE FBT TALKS IS ABOUT THE YEAR OF PROVIDING THE BENEFITS-BUT NOT WHEN THEY ARE ACCOUNTED.
FBT IS THUS PAYABLE IN THE PREVIOUS YEAR
IN WHICH THESE BENEFITS ARE PROVIDED .
R.V.RAO
1.FRINGE BENEFITS ARE PROVIDED BY EMPLOYER
2. THESE BENEFITS ARE PROVEIDED O THE EMPLOYEES.
3.THESE BENEFITS ARE PROVIDED DURING THE PREVIOUS YEAR.
THUS WHAT THE FBT TALKS IS ABOUT THE YEAR OF PROVIDING THE BENEFITS-BUT NOT WHEN THEY ARE ACCOUNTED.
FBT IS THUS PAYABLE IN THE PREVIOUS YEAR
IN WHICH THESE BENEFITS ARE PROVIDED .
R.V.RAO
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