Reimbursement

This query is : Resolved

Samir Agarwal (Querist)
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24 February 2010 conveyance reibursement can be taxable in individual hands after the abolition of fbt. now if we are regularly paying the fixed conveyance reimbursement to our employee then how can we save the employee by not getting him tax in perquisites valuation.

CA Vijay Kumar Gupta

CA Vijay Kumar Gupta (Expert)
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24 February 2010 paying the fixed conveyance reimbursement is covered under conveyance allowane and excess of Rs. 800/- p.m. is taxable in the hands of employee.

Samir Agarwal

Samir Agarwal (Querist)
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24 February 2010 thanks Mr Gupta, but how can we save this amount to be taxed in employee hand.

can we pay reimbursement to employee with a ceiling limit difine for each employee and fix it only for official purpose then also is it liable to be taxed in employees hand.

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CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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24 February 2010 Conveyance reimburement or allowance both are taxable to the extent of offical usage.Rs.800 exemption available only for transport allowance