Iam working in a Pvt Ltd Company, it is a management consultancy.We have 15 Employees and 15 outside consultant(not employees).
Now our Company incurs the following expenses through reimbursement for the expenses incurred by the Consultants and employees: (1) Local Conveyance. (2) Hotel Expenses.
Now my doubt is that our Company, reimburses the above mentioned expenses for both the Company's Employee and outside Consultant.
The FBT Charging Section(115WA) states that, FBT is attracted only when there is Employer Employee relationship.
Can we pay FBT on the Expenses incurred for the Employees alone and leaving Consultant expenses ?.
Please Reply (if possible with relevant Notifications issued by CBDT)
09 December 2008
Pay FBT on the expenses incurred for employees. Pl refer question 2 and 3 of circular 8/2005 dt 29/08/2005. Expenses of consultants is out of the purview of FBT since there are no employer employee relationship between company and the recipients.