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fBT ON INTERNET CHARGES

Muthu Aravind (Article) (188 Points)

28 June 2008

WHETHER INTERNET CHARGES FOR A MFG COMPANY INLUDED IN FBT OR NOT? IF INCLUDED UNDER SEC. 115WB(2)(A) OR 115WB(2)(J)?

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3 Replies

Rishubh Mathur (Analyst -Taxation) (442 Points)
Replied 28 June 2008

Expenditure incurred on internet services is not taxable under FBT either u/s 115WB(2) (A) or (2)(J).

1.Whereas, sub clause (2)(A) covers expenditure incurred on entertainment - expenditure in connection with exhibition, performance, games or sport.

2.On the hand, subclause (2)(J) covers expenditure incurred on use of telephone, excluding leased telephone lines, but including mobile phones. This clause too excludes use of internet services.

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Prabhash Chandra Jha (TAX CONSULTANT) (48 Points)
Replied 18 July 2008

INTERNET CHAGES INCURREDBY THE COMPANY IN HIS OFFICE PRIMESES FOR THE COMPANY WORKS IS NOT LIABLE FOR FBT. HOWEVER IF THIS WILL PROVIDE TO THE EMPLOYEE FOR ENTERTIANMENT OR HIS PERSONAL PURPOSE THEN IT WILL TAXABLE

SANTHIPRIYA S (Student) (64 Points)
Replied 22 July 2008

Internet charges incurred by a company will not come under FBT.

[In sec 115WB(2)(a) it is only about entertainment expenses and In sec 115WB(2)(j) is only about telephone including mobile and nowhere it talks about internet charges]