ESI deduction for Conveyance Allowance

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 July 2010 Ours is a private limited company paying conveynce allowance as part of salary and it is paid monthly and incorporated in monthly salary statements.

We have seen some instructions fro ESI directorate that CCA if paid monthly,should form part of "wages" for ESI coverage.Otherwise it should be paid beyond two months paeriod and it should be as reimbursement of actual expenses.

Please confirm my views with recent notifications/circulars.

Should we consider monthly CCA for the basic exemption limit of Rs.15000.

Thanks in advance

NK

Rahul Gupta

Rahul Gupta (Expert)
Follow

09 July 2010 ESI is paid on Gross Salary. Gross salary included allowances paid monthly and accordingly will be included for calculating ESI limits.

So CCA will be considered fro the basic exemption limit of Rs.15000.