01 June 2011
Our company is paying Rs.18000/- per month to some employees who are working in the night shift. In addition to this salary Rs.1000/- is paid extra as night allowance. Company is providing vehicle for dropping them at their houses after office hours. The cost of the hired vehicle is shared by the employee and the company on a 50:50 basis. Consequently an amount of Rs.750/- is dededcuted monthly from employee's salary. My doubt is whether we have to take Rs.1000/- as part of salary or Rs.250/- (1000-750).
Look if the allowance is given a NIGHT ALLOWANCE than i guess it will be taxable . However if it is given as Transport Allowance to meet the cost of commutation from Office to Residence than you may take the deduction. So if you are an accountant of that company than judge it whether it is necessary to put night allowance or we may put it like Transport Allowances.
What i have inferred from your query is that NIGHT ALLOWANCES IS NOTHING BUT A TRANSPORT FACILITY WWHICH MAY BE TAKEN AT the amount given less any thing charged from the employee
CAclubindia
