Treatment of perdium allowance after FBT abolisition
This query is : Resolved
16 September 2009
what is the position of perdium allowance paid to salaries employee after FBT abolisition ?
16 September 2009
Hi Saravanan,
Any fixed allowance is taxable as salary subject to the specific exemptions under Section 10(14). This section states maximum amount exempt from tax is, to the extent the allowance is utilised for the specific purpose for which the said allowance is given. That means the actual expenses incurred is tax free and balance if any is taxable.So as per income tax act one should keep the bills for claiming the exemption.
Upto 31.03.2009 most of the employers used to book the the total per diem allowance to the Travelling,Conveyance,Hotel expenses and used to pay FBT on that.Now theoritically the part of the allowance for which an employee can provide bills should be booked to the repective head and balance should be booked in salary and wages and employee should pay tax thereon.
Any fixed allowance is taxable as salary subject to the specific exemptions under Section 10(14). This section states maximum amount exempt from tax is, to the extent the allowance is utilised for the specific purpose for which the said allowance is given. That means the actual expenses incurred is tax free and balance if any is taxable.So as per income tax act one should keep the bills for claiming the exemption.
Upto 31.03.2009 most of the employers used to book the the total per diem allowance to the Travelling,Conveyance,Hotel expenses and used to pay FBT on that.Now theoritically the part of the allowance for which an employee can provide bills should be booked to the repective head and balance should be booked in salary and wages and employee should pay tax thereon.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Price inclusive or exclusive of GST while made entry in P& L Account
- Gst registered proprietorship firm
- TDS Challan - change of FY 2025-26 to TY 2026-27
- AUDITOR APPOINTMENT FOR THE YEAR ENDING MARCH 27
- Dep. as per companies act
- Minimum tax payable to file Updated return
- Applicability of GST on Salary Reimbursement Component
- CHECK RELATED
- UDIN ISSUE
- Change Of Karta In Case of Death
- Non filing of I T Returns
- How to Handle Active E-Invoices in GST Portal Deleted from Tally?
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Starting trading business
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
