04 November 2011
My employer is a subsidiary of a multinational company. It has a policy of Study support for employees where the company reimburses the Study Material cost and Exam fees to its employees for selected courses which are directly relevant for the job.
They are deducting TDS on such reimbursements by saying that they are in the nature of perquisites. My question is are such reimbursements taxable?
Suppose if the employer whould have directly conducted such course in the office, it would obviously have not been taxable to employees, then why in this case.... as there is no difference in the outcome, the only difference is in the way it is structured....
Any helpful caselaws will be appreciated... Thanks
04 November 2011
there is a big difference. when the bill is name of you or in name of company. when you joined a course and paid fees the bill is in name of you so perquisites and will be taxable in your hand. but if company is conducted some course then the bill is in name of company so there is no perqs and not taxable in your hand.
04 November 2011
Sir can a stand that it is an expense incurred to properly discharge duties of company and hence not taxable as perquisite be taken as that knoweledge has to be directly applied to work...., because under the same stand even travelling expenses like air ticket, though in name of employee, are not taxable on reimbursement......
04 November 2011
In no case there is liablity of the company to deduct the tax treating such sums as perx. As even if the said sum is perx-the same is not liable for tax. and if it is an allowance and the amount of allowaance paid is exactly equal to the sum of actual expenses then no part shall form the taxable income.
CAclubindia
