KINDLY LET ME KNOW WHETHER SUM PAID TO EMPOLYEE SETTELEMENT AFTER END OF SERVICE IS ALLOWABLE DEDUCTION UNDER PROFIT & LOSS ACCOUNTS AND INFORM WHICH KIND OF EXPENDITURE ???
09 March 2009
There can be two type of expenses incurred:
01. At the time of settlement : those are salary till last date, any bonus due or any other sum payable to employees as his salary.
02. After settlement : this can be any expenditure on account of personal skills like professional services or contract with him for any specific work.
All this expenses is allowed as deduction in income tax.
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