If a company pays the Car maintenance expenses of its directors (director is owner of car) then which entry should be made?
is it legal ?
2 Replies
CA. Kirti S. Ganatra
(Service)
(1461 Points)
Replied 29 February 2008
Yes it is allowed. But for formality purpose it must be passed in board meeting. Dr. Car Expenses Cr. Party/ Cash
CA Dushyant Maharishi
(CA)
(178 Points)
Replied 03 March 2008
Yes the company can pay the car maintenance exp. of the directors but it should be approved in the board meetings.However for the purpose of IT matter it should be taxable in the hands of the company as fbt.
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