Food Reimbursement

Dear Yogita,

Food reimbursements given to employees (other than in the form of Daily allowance on tours or any official lunch/dinner ) is fully taxable.

food reimbursement perqusities is fully taxable

Any lunch/dinner/Refreshment Allowance paid by the emplooyer is fully taxable. If free  meals are provided during the working hours then taxable value of perquisite will be

a) Actual Cost to the employer in excess of Rs 50 per meal

b) less : Amount recovered from employee if any

c) Taxable value of perquisite

Free meals provided will not be a taxable perquisite, if it is provided in any remote area or offshore installation area.

agree with sathish....

Dear Yogita,

i am not agree with sathish, rahul

it is my opinion, based on past experience , that a request for reimbursement of expenses incurred in the course of working is not taxable

Dear Yogita,

i am not agree with sathish, rahul

it is my opinion, based on past experience , that a request for reimbursement of expenses incurred in the course of working is not taxable

for a example any business guest will come in your office and you are provide lunch,snacks

then u are reimb. for lunch exp. during visit of official guest in the office this not a taxable

i hope your query is soved out

Tanks - Rahul

Dear All,

I have a query on the same subject that a company is providing free lunch (or you can say- concessional)  to its employees and the company is deducting Rs.200/- per month from the salary of its employees. Now my question is what will be the taxable amount to be included to each employee as perquisites, assuming that the meal cost per person is Rs.60 per head.

Thanks in advance.

Dear Rahul,

Eventhough expenditure relates to official purposes, employee derive some benefit on account of his association with his employer. That is why, in respect of reimbursement of some official expenses Income Tax Act specifies Maximum Exempt amount. For Example Travelling allowance given for meeting travelling expenditure from residence to office and back is exempt upto Rs 800 in case of normal employees and Rs 1600 in case of handicapped employees.

Still there are some expenses/benefits to employees which escapes from tax. Considering this only FBT was introduced and which was later abolished also.

I hope I have made an attempt to provide some clarity to the issue

agree with satish in respect of yogita query

and dear suraj sir employee will be liable to pay tax based on following treatment

no. of meals in a month*10 rs. per meal

less:-200 rs.per month

taxable amount(if it positive)

Dear Suraj Barnwal Sir,

Assuming that the company has provided free meals for 300 working days in a year, the value of perquisite taxable in the hands of employee will be

Hence Rs 600 will be taxed as perks in the hands of each employee.

Dear sathish

Conveyance Allowance is not a traveling exp.and limit i know that of Rs.800/-

I have allready recd. of rs.800/- as a conveyance allowance and salary part of Rs.5625/- as a conveyance exp.

this is not a taxable of conveyance exp. under FBT

and i have paid of rs.1000/- per month as a conve. allowance so Rs.200/- taxable

you got it my point

Dear Rahul,

I Know that conveyance Allowance in not a Travelling expenditure. But the point I want to highlight is though it is paid to meet the travelling expenses from home to office and then back, it is considered that the employee derive some personal benefot from it. Hence it is not fully exempted from Tax.

Similarly Food reimbursement to the employee may also be considered as purely official in nature. But if it exceeds the reasonable cost it should be taxed. Hence a reasonable cost of Rs 50 per meal is specified in the Act and taxed in the hands of employee.

I just gave yo u a background of FBT for example. I dont want to go deep into it. I think you too got my point

I routinely on travel for marketing and client project related activities. I frequently spend from my pocket and get it reimbursed. 

1. Is there any limit to travel expenses reimbursement?

2. Should TDS be incorporated into travel expenses BEFORE or AFTER reimbursement?

3. I also sometimes get travel advance for the same, should it include TDS or will it be deemed as income in my name?

At the end of the month, I tally all travel expenses with travel advance. What will be the income tax implication?