Basic Processor of FBT

This query is : Resolved

vipan (Querist)
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23 October 2007 hi all

i want to know what is the basic processor & formalities of FBT like..
Form
heads on which tax is applicable
Tax rates
Date of filing Return ie annually semi annually quarterly or monthly

Thanks & Regards
Vipan

CA. Ramesh P Choudhary

CA. Ramesh P Choudhary (Expert)
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23 October 2007 As per the Finance Bill, fringe benefits shall be deemed to have been provided if the employer has incurred any expense or made any payment for the purposes of:

(a) entertainment;
(b) festival celebrations;
(c) gifts;
(d) use of club facilities;
(e) provision of hospitality of every kind to any person whether by way of food and beverage or in any other manner, excluding food or beverages provided to the employees in the office or factory;
(f) maintenance of guest house;
(g) conference;
(h) employee welfare;
(i) use of health club, sports and similar facilities;
(j) sales promotion, including publicity;
(k) conveyance, tour and travel, including foreign travel expenses;
(l) hotel boarding and lodging;
(m) repair, running and maintenance of motor cars;
(n) repair, running and maintenance of aircraft;
(o) consumption of fuel other than industrial fuel;
(p) use of telephone;
(q) scholarship to the children of the employees.

The value of fringe benefits shall be the aggregate cost incurred. That is, the total expense deducted will be considered for purposes of levying fringe benefit tax. From this, a certain percentage will be deducted. The difference therein will be taxed at the rate of 30%.

However, the fringe benefit tax rate varies from 10 per cent to 50 per cent depending upon the expense incurred: For example, for the use of telephones 10 per cent fringe benefit tax will be charged, while entertainment expenses, festival expenses, gifts, use of club facilities, etc will be taxed at the rate of 50 per cent.

Payment of FBT
Period Due date for payment of FBT
Quarter to end on
30 June
30 September
31 December
15th day of the month following such
quarter

Quarter to end on 31 March
15th day of March of the said financial
year
Any excess advance tax paid for the preceding quarter can be adjusted against the
advance tax for the subsequent quarter(s).
Payment of FBT is not allowable as deduction from the income [Section 40 (a) (ic)].
Filing of return of FB
Category Filing Due Date
A company, a person (other than a
company) whose accounts are required to
be audited under this Act or under any
other act for the time being in force
31st day of October of the assessment
year
In case of any other employer 31st day of July of the assessment year

vipan

vipan (Querist)
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26 October 2007 Thnax

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