CA CHINTAN AJMERA (Chartered Accountant) (2987 Points)
13 September 2008Some author say that car insurance is not liable for F.B.T (E.G. READY RECKNOR, V.K.SINGHANIA , TAXMAN) And some say that it is liable for F.B.T (E.G. G.SAKER PADHUKA ) So how can we decide that it is liable for F.B.T or not ?
CA. Anubhav Jaggi
(CA)
(104 Points)
Replied 14 September 2008
i think it should not be liable to FBT. i also searched books few days ago for the same problem,but i didnt find the word insurance for liability of FBT.
i suppose the reason may be that there is not any deemed employee benefit. as whole insurance amount is paid to third party i.e.insurer. thats why its not liable to FBT.
wht u say?
Amritansh
(Chartered Accountants)
(47 Points)
Replied 14 September 2008
Hi,
Car insurance is related to the maintenance of motor car and so it liable for FBT.
Regards
Amritansh Agrawal
Jitender
(Chartered Accountant)
(8724 Points)
Replied 14 September 2008
i also agree with amritansh.
jaideep
(Articleship)
(44 Points)
Replied 14 September 2008
if any expense relating to vehicles , whether it may be maintanace expense or insurance or even depreciation , all the expenses IN RELATION TO VEHICLES are liable to FBT
Ravi Satpal
(CA (Final) & CS (Executive) Student)
(2430 Points)
Replied 14 September 2008
yes car insurance is included in FBT...since it is a part of car repair and maint
Girish
(AICWA)
(25 Points)
Replied 14 September 2008
Yes. As interest on Car Loan is also subject to FBT there seems no reason to exclude insurance expenses.
SRIKANTH
(Student)
(300 Points)
Replied 22 October 2008
yes it is liable for fbt
any revenue expenditure in relation to motor car is liable for fbt
CA Nipun Singhvi
(ACA LCS BCCD IFRS Certified(ICAI))
(65 Points)
Replied 13 November 2008
I dont think it is liable for FBT I have not found any text such as all revenue expenditure i relation to motor car shall be liable to FBT ..In my view it shouldn't be liable to FBT
Kuldeep Maloo
(Audit Manager)
(90 Points)
Replied 19 November 2008
Yes no dought in it dear
in section 115 wb 2 h says clearly that every expenditure including depreciation are liable for FBT.
B.Nagesh
(MBA- CS Execuitve)
(151 Points)
Replied 20 November 2008
Yes, Car Insurance is liable for FBT
CA Pawan Goswami
(CA)
(2928 Points)
Replied 20 November 2008
Repairs and Maintenance includes Car Insurance. Hence, it is liable to FBT.
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bhargav dave
(articled assistant)
(22 Points)
Replied 23 May 2009
Hi folks, i would like to add a point here. I have not referred this in the book, but by simple logic we can argue that insurance is not something without which a car would not run. Expenses for REPAIRS, RUNNING and MAINTENANCE are liable for FBT.
Can insurance of a car be called maintenance?
Yes I agree to the point that if insurance of the car, which belongs to the employee, is paid by the employer can attract FBT because it will be an expenditure of the employee borne by the employer.
But if the car belongs to the employer, according to me, cannot be chargeable to FBT.
Law has simply written " repairs, running (including fuel) maintenance of motor cars and the amount of depriciation thereon"
Interpretetion might be different for different users.
I have told my opinion. Please correct me if I am wrong.
Thank you
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