Save Rs 499 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

80JJAA Additional employee cost

303 views

Save Share

Karthik

Student

32 Points Posted on 07 September 2021

Hi,

As per sec. 80JJAA, deduction on additional employee cost can be claimed for three assessment year.

whether additional employee cost (AEC) on 1st year can be claimed for three continues years
OR
Company can claim three years only if it has incurred addl emp cost in each and every year?

what if there is no additional employee cost on 2nd year and it has incurred AEC in 3rd and 4th year?
kindly clarify.

Replies (2)

Quick Summary

This discussion clarifies the rules for claiming deductions under Section 80JJAA for additional employee costs. The key point is that while the deduction is available for three assessment years, it can be claimed in any year the additional employee cost is incurred, provided the new employees have been with the company for at least 240 days. There's no strict requirement for a continuous increase in employee numbers each year to claim the benefit.

JGM

Knowledge Sharer

443 Points Posted on 07 September 2021

Section 80JJAA does not cast any condition that every year there should be increase in the number of employees. However, it has a condition that the employee for which the deduction has been claimed should be with the organisation for atleast 240 days. Hence, the deduction can be claimed for subsequent year even if there is no increase in subsequent year subject to the condition that 240 days and other conditions (viz. salary etc.) is satisfied.