kindly let me know abt my query:
if any company on behalf of our client some expenses incurred but same expenses reimbursed by client laterwith the invoice amount.
1. can we charged FBT on the same reimbursement expenses.?
2. FBT is our company tax or client tax?
3. if FBT is our company Tax we can show in P& L a/c as a miscellaneous expense. if yes then why it shown in misc. expenses?
Please explain this point in detail.
Your Query is not Clear
if expenses are reimbursed where is the question of it appearing in your books of accounts ....as when receiving payment you will credit that proportinate amount to that expense ...if the amount reciieved is less than incurred then you will have to pay FBT on difference amount
is the expenses on repairs of motor cycle is lible for FBT.
Hiii
If you incur expenditure on behalf of the client and later get it reimbursed from the client still it is liable to FBT as per the Board Circular.
Hey nidhi..
Your question is not clear..... I think you need to make it more simple....
Further,
In this case, the actual expenses incurrer will have to pay the FBT
if any company has been paid expenses on behalf of our client but same expenses has been reimbursed by client lateron with the invoice bill amount.
According to the act of FBT, I understand that reimbursement expenses will be taxable in the hand of company not in the hand of client. but my query is that in company books where FBT amount Shown .
Hope that now everybody can understand my query?
Please send the FBT Rate List also....
firstly u r correct that If the expenditure is incurred by an "employer" and it is later on reimbused by client, the employer will be subject to fringe benfit tax (not client) - Circular No. 8/2005, Dated 29-08-2005.
As per my opinion it should be treated as income tax. if anybody has other opinion please intimate.
Regards,
CAclubindia
