Arvind Ray (Practising Advocate CS LLB) (339 Points)
16 September 2011dear esteemed members,
My query is related to income tax. there is a dispute between two parties. they come to a settlement for a specific amount. what tax is deducted if the disputed amount is paid under the terms of dispute settlement. and what provisions of IT act are applicable.
Thanking in advance
arvind
Mihir
(Wealth Manager)
(5293 Points)
Replied 16 September 2011
It will depend on nature of this dispute? Little elaboration.
Arvind Ray
(Practising Advocate CS LLB)
(339 Points)
Replied 16 September 2011
the dispute is like this... the employee claimed some employee benfit from the employer. the employer refused. the employee sent alegal notice, in counter, the employer claimed some amount from the employee on account of damage done to company property. now both settled for an particular sum. so what will be the tax if the employer pays this sum to th empoyee.the employment has been terminated before this settlement
Mihir
(Wealth Manager)
(5293 Points)
Replied 16 September 2011
It will be an expense for the employer, and income for the employee.
The employer cannot deduct tax on this.
Just adjust the damages to the company property recovered from the employee.
Wait for other's reply
Arvind Ray
(Practising Advocate CS LLB)
(339 Points)
Replied 16 September 2011
means that NO TDS is to be deducte. what about the I T liability of the employee
Arvind Ray
(Practising Advocate CS LLB)
(339 Points)
Replied 16 September 2011
for the above relies, what provisions of income tax should be referred to substantiate the replies
Annu.R
(CA,CS,B.Com)
(2788 Points)
Replied 16 September 2011
Donot forget Insurance factor in this matter..........
C.A. Sandeep Wawhal
(Chartered Accountant PGDFM BCom.)
(1823 Points)
Replied 16 September 2011
If benefit which employee claimed/ received as settlement falled under excempt income then t tds will not applicable. Please confirem which benefite he claimed.
Ramanuj
(Accountant.)
(834 Points)
Replied 16 September 2011
TDS is not applicable becouse it is benefit for employee.
U S Sharma
(glidor@gmail.com)
(21056 Points)
Replied 16 September 2011
| Originally posted by : arvind kumar ray | ||
 |
the dispute is like this... the employee claimed some employee benfit from the employer. the employer refused. the employee sent alegal notice, in counter, the employer claimed some amount from the employee on account of damage done to company property. now both settled for an particular sum. so what will be the tax if the employer pays this sum to th empoyee.the employment has been terminated before this settlement |
 |
employment benefits has its own set of rules for incometax and may be tax free or taxable as per rules, but your query did not reflected that if employee and employer both has claimed then who is payee and who is receipent?
nature of employment benefits are required to view the exemption , if available
srinivass
(CA Final)
(2466 Points)
Replied 17 September 2011
| Originally posted by : aditya(ca learner) | ||
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AGREED WITH ABOVE |
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