Taxability of car used in business

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 February 2016 Dear all, A car is owned by employee the same car is being used partly for business and partly in employee's personal uses however the employer is providing fuel exp. to employee when car will be used for business... plz let me know the taxability in the hand of employee... Regard Kapil verma

CA CMA CS Ram Pavan Kumar Melam

CA CMA CS Ram Pavan Kumar Melam (Expert)
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01 February 2016 The fuel expenses are being reimbursed by the employer. In case of reimbursement, there will be no element of profit to the employee and moreover the employee spends on behalf of the employer. There is no taxability in the hands of employee on receipt of fuel expenses reimbursement. The reimbursement of fuel will be a deductible expenditure to the employer.

Querist : Anonymous

Querist : Anonymous (Querist)

01 February 2016 sir. the employer is reimbursing the exp. on estimated basis not on billing basis therefore there may be element of profit in the hand of employee, plz tell me the taxability in the hand of employee...

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CA CMA CS Ram Pavan Kumar Melam

CA CMA CS Ram Pavan Kumar Melam (Expert)
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01 February 2016 If the motor car owned by employee and car used partly for official duties and partly for personal purpose by him or any member of his household then, actual amount incurred by employer as reduced by Rs 1,800*/Rs 2,400** per month (plus Rs 900 if chauffeur is provided).

If the documents / record of expenditure are maintained, showing details of official or personal use and the taxability of such income is lesser than the amount arrived at above, the beneficial one may claimed by the employee.