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relocation allowance

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This query is : Resolved

ahmer (Querist)

27 September 2007 Hi,

I am facing a problem in relation to my client's policy of reimbursing the relocation expenses to it's employees in connection with their shifting base to NOIDA or GREATER NOIDA. They reimburse the actual expenses subject to the limit of Rs. 25000, both to new joiners and existing employees.

I am a bit confused with the FBT implications, applicability of Section 17(2) and that of Section 10(14) with Rule 2BB.

Kindly bless me with a professional advice.

Thanks and regads

CA Ahmer Ammar

Sanjeev Kumar Varshney

Sanjeev Kumar Varshney (Expert)

28 September 2007 Mr Ahmer
In my opinion, relocation expenses reimbursed by the company shall be liable to FBT only and will not be taxable in the hand of employees.

CA. Raviprakash M.S

CA. Raviprakash M.S (Expert)

29 September 2007 reimbursement of expenses covered u/s 115WB(2) and not treated as perquisite u/s 17(2). Liable for fbt

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