Save Rs 499 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

Taxability of Conveyance Allowance

Tax queries 7466 views 3 replies

ashish

28 Points Posted on 22 June 2010

The conveyance allowance of Rs. 800 P. M. is tax free in the hand of employees and if the company provide car/conveyance facility to the employees then what will be the taxability of conveyance allowance of Rs. 800 PM. in case:

i. Company provides car to the employees and add the value of perquisites of car in the salary and deduct TDS and

ii. Company provides conveyance facility through company bus to the employees and do not charge any amount from employees.

Replies (3)

Guest

dear ashish

conveyance allowance is exempt subject to expenditure.amount received and expenses whichever is low is exempt u/s 10(14) and the other thing is car facility. if it is provided for home to office then it is tax free otherwise taxable.allowance and facility are different things and separate treatment.

regards

tarun rustagi

CA Suri Kota

Assistant Manager @ EY

955 Points Posted on 22 June 2010

Agree with Tarun..Irrespective of other provisions , an employee is given exemption for conveyance at 800 pm.

Guest

dear suri 800 p.m exemption is for transport allowance and not for conveyance allowance. conveyance allowance is exempt subject to expenditure. both are covered by sec. 10(14) with different treatment.