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Prerna (Querist)
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25 February 2011 1) What is the difference between conveyance and travel allowance?

2) Can the employer company reimburse any payments made by the employee and then the employee can show it as perquisite ?
OR
the employer can reimburse (or pay) only those bills as mentioned in the Income Tax Act like the payment of salary to domestic servant, or paying the gas bills ?

3) Can a company reimburse dental bills of an employee? How will it be shown in the Income Tax return of the employee?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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25 February 2011 1. Conveyance is given on the travel with in the city/town, travel given on the travel beyond the city

2.if employer reimburse the expenses in personal nature, then it will be perquisite

3.As a medical reimbursement perquisite

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CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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25 February 2011
1) What is the difference between conveyance and travel allowance?

As the name suggest, conveyance allowance is meant for expenses incurred towards auto rickshaw or for petrol expenses etc. or for local visits.
Whereas Travel Allowance is meant for outstation visits like Ticket Fare and other incidental expenses incurred by the employee during his travel.

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CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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25 February 2011 2) Can the employer company reimburse any payments made by the employee and then the employee can show it as perquisite ?

Ans. Reimbursement generally means , first the employee had incurred expenditure on behalf of the company and later on company repays it on producing bills, vouchers etc.
Any payment made by the employee can be reimbursed by the company provided the employee is authorised to incurr such expenditure on behalf of the company.

Reimbursement towards personal expenses of the employee are generally covered under the service agreement or as per rules of the company.

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