Simple but confused !

An employee who left job during F.Y 2010-11 without the salary being settled.

Now in  the FY 2011-12 the company settlles the dues of such employee..

When should company has to claim the expenditure ????? In FY 2010-11 or FY 2011-12 ?

Replies (2)

Robin, co. should claim  the expenditure in FY10-11 as the expenditure has been for FY10-11 although it might have been paid later.

For Example : An employee gets salary for the month of march 2011 on 1st day of April 11, it is an exp. for the FY10-11 and shouldn't be claimed in the year FY11-12 ( if the co. is following accrual concept)

salary income is taxable on due or receipt basis which ever is earlier for the person....so for individual it is taxable in he FY 10-11 and  company can claim this exp for the financial year 10-11.......

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