if employee's contribution for the provident fund is received by the employer but not deposited by him, in such a case this amount is treated as the income of the employer under which head???
PREETI SHARMA (34 Points)
22 April 2018if employee's contribution for the provident fund is received by the employer but not deposited by him, in such a case this amount is treated as the income of the employer under which head???
CA Rashmi Gandhi
(Chartered Accountant)
(86318 Points)
Replied 22 April 2018
RAJA P M
("Do the Right Thing...!!!")
(128083 Points)
Replied 22 April 2018
PREETI SHARMA
(34 Points)
Replied 22 April 2018
RAJA P M
("Do the Right Thing...!!!")
(128083 Points)
Replied 22 April 2018
Disallowed under Salary Paid head and It will be added into PandL... I think it is treat under PGBP...
CA Rashmi Gandhi
(Chartered Accountant)
(86318 Points)
Replied 22 April 2018
Kashish Jain
(60 Points)
Replied 23 April 2018
RAJA P M
("Do the Right Thing...!!!")
(128083 Points)
Replied 23 April 2018
Kashish Jain
(60 Points)
Replied 23 April 2018
RAJA P M
("Do the Right Thing...!!!")
(128083 Points)
Replied 23 April 2018
Please,
First understand the Query and Second go to read the replies....
Also Please find the diffrence between "EMPLOYEE'S CONTRIBUTION & EMPLOYER'S CONTRIBUTION"
How to account these head in books of accounts in company (employer)...?
What is Employer's Contribution and It's accountability...?
What is EMPLOYEE'S CONTRIBUTION & Where from this amount and It's accountability...?
Kashish Jain
(60 Points)
Replied 23 April 2018
RAJA P M
("Do the Right Thing...!!!")
(128083 Points)
Replied 23 April 2018
|
Employee's contribution |
Employer's contribution |
||
|
1) |
Income |
Income as per section 2(24)(x) Because it is recovered from salary payable and paid on their behalf. Nothing to do with the salary cost. |
No question of income. |
|
2) |
Deduction |
When paid, allowed as deduction. Section 36(1)(va), 43B(b) |
|
e.g.
Salary: 1 lac
Employer’s contribution: 12,000
Employee’s contribution: 12,000
Total salary cost to employer: 1 lac + his contribution (12,000) = 1,12,000, where 12,000 is allowed as deduction only on payment. [Section 43B]
Employee’s contribution of 12,000 is treated as income. Since it is related to business, it is income from PGBP. However, the amount is allowed as deduction only on payment.
Sample Computation:
PROFIT 28,12,000
Employee’s contribution 12,000
INCOME 28,24,000
Deductions:
Salary 1,00,000
Employer’s contribution paid 12,000
Employee’s contribution paid 12,000
NET INCOME 27,00,000
Hope it clears the doubt.
Live Course on Invoice Management System (IMS) - 2nd Batch(With Recording)
CAclubindia
