Expenses over 20000

Tax queries 421 views 3 replies

SP2010

Manager

58 Points Posted on 01 September 2010

Hello,

I am one of the directors of a pvt limited company and have paid for some books and software CD-ROM using my personal credit card (as the Vendor will only accept credit card payments from overseas customers). The item that's most expensive is the software worth nearly INR 37,000. Can I now raise an expense claim for 37,000, attach the receipt (in USD) and claim it back from the company? (note that company allows such expenses under its policy). Can the company pay the Director as online payment for the abovementioned cliam. It sounds simple but read somwhere about payments other than cheque exceeding 20,000 and wanted to get your advice.

Thanks for your help

Replies (3)

Kamal Jain

FCA

200 Points Posted on 01 September 2010

As per Rule 6DD(c) of Income Tax Rules Payment through Credit Card and Electronic Transfer are not subject to disallowance.

SP2010

Manager

58 Points Posted on 01 September 2010

Hi Kamal - Thanks for your response.

Just so I understand this a bit better, does this mean: a) I can raise an expense claim for 37,000 (paid for using my personal Credit Card) and b) The company can reimburse me as online payment (NEFT bank transfer) for the abovesaid amount.

Also, is there any tax implication for me or the company in this regard.

Kamal Jain

FCA

200 Points Posted on 01 September 2010

a) I can raise an expense claim for 37,000 (paid for using my personal Credit Card) and b) The company can reimburse me as online payment (NEFT bank transfer) for the abovesaid amount. YES

is there any tax implication for me or the company in this regard. NO