UNIFORM ALOWANCE


This query is : Resolved 

(Querist)
07 August 2007 providing fixed amount as Uniform allowance to the employees is better or reimbursement of the uniform expenditure better from the employer point of view for thepurpose of tax benefit?

further is there any way to rule out FBT on the uniform allowance?

CA Mani (Expert)
08 August 2007 From the view of employer,

Better to pay allowance to Employees. Bcoz He need not pay tax on such exp.

If he gives reimbursement, It'll be taken as employee welfare and FBT to be paid by employer.

So, Better to Pay alllowance.

If you pay allowance, It'll fall under the head salaries. It's not FBT'ble.

08 August 2007 ANy allowance to meet the expenditure for purchase or maintenance of Uniform wear during performance of duty of an Office is exempted.
Similarly if uniform is statutorily given to every employee, it will not be liable to FBT.
So Uniform expenses are liable to Income Tax in the hand of employee or liable to FBT if not incurred actually for Official purpose.

Jitender (Expert)
23 August 2007 i aree with mani


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