Personal expenses and refresh expenses for it

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This discussion clarifies the tax deductibility of personal and refreshment expenses for businesses. While personal expenses are generally not allowed, refreshment expenses may be deductible up to a certain limit. It's important to note that allowances for employee meals, like tiffin or lunch, are typically fully taxable in the employee's hands.

Kollipara Sundaraiah

Kollipara Sundaraiah (Querist)
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16 September 2021 Sir,
It assess net profit as per profit and loss account rs:5,50,615/-in f.y.20-21
Add: estimated personal expenses rs:10,000/-(personal expenses rs:1,50,000/- debited to capital account
Add:sadar (refreshment) expenses rs:5200/-debited to profit and loss account.
Total taxable income rs:5,65,815/-show in itr in f.y.20-21.
Question:
Assess sadar( refreshment) expenses and personal expenses not allowed in it act.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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17 September 2021 For any business entity, any personal expenses not allowed, but refreshment expenses allowed to certain limit.

Kollipara Sundaraiah

Kollipara Sundaraiah (Querist)
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17 September 2021 limit for refreshment expenses in it act

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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17 September 2021 The answer provided is for business expenditures, not the same in employees hand.
For employee any Tiffin/Lunch/Dinner /Refreshment Allowance given is fully taxable.

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