Advance FBT

Hi All

An employee opts for higher reimbursements in his CTC. The Company accordingly calculates and pays Advance FBT o the same. However at the end of the year the employee fails to produce enough bills/supportings to claim the reimbursements. Would the company be required to pay Income Tax on the excess reimbursements ? Or the payment of FBT would suffice? How would it have the effect from Income Tax point of view?

Replies (1)
Hi........ madam, FBT talks about only if company made any reimbursements for the employees then the company is liable to pay FBT.
If that payment is accounted by the company even though the employee has not submitted the bills, company is liable to pay FBT.
No effect from income tax point of view. but according to company law auditor has to assure that for each payment there will be proper documents, in that case auditor will qualify the report.

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