TAX on Reimbursements( Urgent)

This query is : Resolved

vijay (Querist)
Follow

22 January 2010 Our Company is based in hubli, We send employees to bangalore to our clients office where they work at their place , ours is service oriented chip designing company. We call the employees who work from our clients place in banaglore as ONSITE employees.We reimburse them monthly onsite reimbursements as follows:
Food- 3000 per month
Accomodation- 3000 per month
travel(local in bangalore) Rs 1500 Per month

This is paid irrespective they give bills . or actuals as per the bills but not exceding the above amount.

My question is .Whether the above reimbursements are taxable in the hands of employees. At present the same are added to their salary and taxed whcih i feel is wrong as they are not in nature of perks. Kindly clarify in details as per the IT act.

veena

veena (Expert)
Follow

22 January 2010 In case of travel exemption can be claimed u/s. 10(14) which is restricted to Rs.800 p.m. In case of accomodation employee can claim HRA exemption u/s. 10(13A). amount has to be worked out according to conditions in that section. Food allowance will be taxable according to me.

KRISHNA KUMAR R C

KRISHNA KUMAR R C (Expert)
Follow

22 January 2010 Reimbursement of expenses incurred for offical purposes will not come under the pur-view of the TDS provisions and it is exempt from tax.

KRISHNA KUMAR R C

KRISHNA KUMAR R C (Expert)
Follow

22 January 2010 Reimbursement of expenses incurred for offical purposes will not come under the pur-view of the TDS provisions and it is exempt from tax.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
Follow

22 January 2010 if Offical purpose then t is not taxable

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join the CA Students WhatsApp Community for ICAI Updates, Trending Courses & Notes!

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

yadagiri

Tanishka Khandelwal

Rishi Jain

Mikilesh Shah

Ravi

Subscribe Now

TAX on Reimbursements( Urgent)

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Manager- Finance and Compliance

GST CONSULTANT

GST CONSULTANCY

Accountant

CA Final

Article Assistant

Associate CA