Suman (JOB) (43 Points)
06 December 2008Dear All,
The directors of a particular company was sponsered to visit a foreign country by the Bank in which the companies transaction are carried. All the travelling expenses are borne by the Bank. However the directors took Rs.200000 from the company and this expense was booked as travelling expense in the company's books of account. Is this expense Liable to FBT. The tour is not official. Should this expense be debited to director's personal account??
Regards,
Suman Sharma
CA Hemant T Dewani
(Chartered Accountant)
(3356 Points)
Replied 06 December 2008
any expencess which are debited to Profit & loss A/C of travelling exp are liable to FBT
dhirendra kumar purohit
(practising )
(26 Points)
Replied 06 December 2008
All expenses incurred wholly and exclusive for the purpse of the business of the Company can be claimed as normal business expenses.
If you can put forth and convince that expenses incurred during forein travel for the business of the company ,expenses can be debited to P&L A/c.
FBT shall be applicable on the expenses.
Since you have mentioned that tour is not official.Expenses shall be disallowed .
If EXpenses are disallowed , in my poinion FBT should not be Applicable because the expenses are not allowed OR asif not debited to P&L a/c.
Omkar
(Student)
(255 Points)
Replied 07 December 2008
you told us that TOUR is not official,so the expenses booked in P&L a/c will be disallowed.So,there is no question of FBT.
Another way is that you can booked your exp. in P&L a/c under the group salary and wages and deduct TDS u/s 194B thereon and Include this in Form 16 as other reimbursement.
I just ask Mr Purohit that it is Ok or any other implication.
Omkar
(Student)
(255 Points)
Replied 07 December 2008
you told us that TOUR is not official,so the expenses booked in P&L a/c will be disallowed.So,there is no question of FBT.
Another way is that you can booked your exp. in P&L a/c under the group salary and wages and deduct TDS u/s 194B thereon and Include this in Form 16 as other reimbursement.
I just ask Mr Purohit that it is Ok or any other implication.
Suman
(JOB)
(43 Points)
Replied 08 December 2008
Sir,
Thank you for your reply....
Since this is personal expense...can it be debited to director's personal account (drawings).
Shudhanshu Agrawal
(Business)
(2570 Points)
Replied 08 December 2008
| Originally posted by :dhirendra kumar purohit | ||
| " | All expenses incurred wholly and exclusive for the purpse of the business of the Company can be claimed as normal business expenses. If you can put forth and convince that expenses incurred during forein travel for the business of the company ,expenses can be debited to P&L A/c. FBT shall be applicable on the expenses. Since you have mentioned that tour is not official.Expenses shall be disallowed . If EXpenses are disallowed , in my poinion FBT should not be Applicable because the expenses are not allowed OR asif not debited to P&L a/c. |
" |
They should be debited to directors personal account if the trip was not official and FBT will not be applicable
and if director was on official trip then FBT willbe applicable
Prasanna Venkatesh
(Articled Clerk)
(28 Points)
Replied 08 March 2009
| Originally posted by :Shudhanshu | ||
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As long as the company is reimbursing the expense of Travel. FBT should be applicable whether the travel is personal or official. Can anyone clarify the same?
Ranjini.V
(CA Student)
(141 Points)
Replied 08 March 2009
CAclubindia
