27 July 2025
Here’s a breakdown of TDS implications on the allowances you mentioned for FY 2014-15, based on usual Income Tax rules:
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### 1. Car Run Cost & Maintenance Allowance
* **Tax Treatment:** Fully taxable as **perquisite or allowance** unless it is a **reimbursement against actual expenses supported by bills** and paid for official use only. * **TDS:** Deduct tax on the amount paid unless proper bills and proofs are submitted and it's strictly for business use.
### 2. Business Attire Allowance
* **Tax Treatment:** Generally taxable. * **TDS:** Deduct tax on the allowance amount as it’s considered a part of salary income.
### 3. Book Allowance
* **Tax Treatment:** Taxable unless reimbursed against actual purchase bills of books related to business/profession. * **TDS:** Taxable if paid as an allowance without bills.
### 4. Meal Coupon (No printed coupon provided)
* **Tax Treatment:** If meal coupons are **not in printed coupon form**, the amount is taxable as **salary**. * **TDS:** Deduct tax on such allowance. If printed meal coupons are provided, exemption is available up to Rs. 50 per meal.
### 5. Factory Allowance
* **Tax Treatment:** Usually fully taxable unless specifically exempted by law or tied to official expense reimbursement with proof. * **TDS:** Taxable and subject to TDS.
### 6. Telephone Allowance
* **Tax Treatment:**
* If allowance is paid without any proof, fully taxable. * If employee submits **residential telephone bills** and employer reimburses the actual amount, it is exempt. * **TDS:** Deduct tax if paid as allowance without bills.
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### Summary Table for TDS Purpose
| Allowance | Exemption if Bills Submitted? | TDS Treatment | | -------------------------- | ----------------------------------------------- | ----------------------------------------- | | Car Run Cost & Maintenance | Yes, if bills submitted & for official use | Exempt to extent reimbursed, else taxable | | Business Attire | Generally No | Taxable | | Book Allowance | Yes, if bills submitted | Exempt to extent reimbursed, else taxable | | Meal Coupon | Exempt if printed coupons up to Rs. 50 per meal | Taxable if no printed coupon | | Factory Allowance | Generally No | Taxable | | Telephone Allowance | Yes, if bills submitted | Exempt to extent reimbursed, else taxable |
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**Important:** For exempt allowances, employee must submit proof (bills/invoices) to claim exemption. Without proof, full amount is taxable and TDS should be deducted accordingly.
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