What should be account head

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Naveen Chand Khulve

692 Points Posted on 20 March 2009

Where the gift given to an employee should be shown i.e in Staff Welfare or Gift & Represention.

Please Suggest me Proper Head with Justification as the gift is given to a single employee only.

Thanx in advance

as it is given to single employee then will it will be appropriate to show it as Staff Welfare rather than Gift & Representation.

Replies (6)

kaustubh

CA CS CFM

206 Points Posted on 20 March 2009

staff welfare will be the appropriate head according to me.

is the employee covered ub\nder sec. 40 (a)(2) ?

Nandoo

CA Final Student

41 Points Posted on 20 March 2009

Originally posted by :Naveen Chand Khulve
"	Where the gift given to an employee should be shown i.e in Staff Welfare or Gift & Represention. Please Suggest me Proper Head with Justification as the gift is given to a single employee only. Thanx in advance	"

Hi,

Its better Debit to Staff Welfare(Expense incurred to motivate Employees) rather than Gifts and Compliments (Expense wrt Outsiders, clients and Visitors)

The reason is when u consider the ledger balances for computation of FBT. 20% of Staff Welfare Expense will qualify for FBT but in case of Gifts and Compliments 50% of the value will get qualified for FBT.

Regards..