Employee benefit expenses or Mess expenses
This query is : Resolved
Quick Summary
19 August 2023
Dear Experts,
1 A company is providing the lunch to its employees through its outsourced catering service providers.
2 It does not charge any amount to its employees,
3 The query is:
a.Whether the expenes incurred by the company, needs to be accounted either as Employee benefit expenses or Mess expenses.
4 Pls clarify
1 A company is providing the lunch to its employees through its outsourced catering service providers.
2 It does not charge any amount to its employees,
3 The query is:
a.Whether the expenes incurred by the company, needs to be accounted either as Employee benefit expenses or Mess expenses.
4 Pls clarify
Gokul Sharma
(Expert)
19 August 2023
Staff Welfare can be debited............
Message likes :
1 times
19 August 2023
Yes, It can be account as Labour Welfare under Employee benefit expenses...
Message likes :
1 times
28 October 2026
Booking it as staff welfare is fine; on GST, ITC on the caterer's bill is blocked under Sec 17(5)(b) unless providing canteen food is obligatory under a law such as the Factories Act, and free food to employees under the employment contract isn't a separate supply.
28 October 2026
Show it under 'Employee benefits expense – staff welfare' in Schedule III; on the GST side, ITC on the outsourced catering bills is blocked u/s 17(5)(b) unless providing a canteen is obligatory under a law (e.g., Factories Act for 250+ workers), so book the GST as part of the expense.
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