Gifting of leaves
H.2017 R (9 Points)
07 June 2021
Anyone come across gifting of earned leave by one employee to another and how it is treated in books
6 Replies
CA. Heet Shah
(Tax Consultant & Practitioner)
(6180 Points)
Replied 07 June 2021
Gift is considered under the Head income from Other Sources.
CA. Heet Shah
(Tax Consultant & Practitioner)
(6180 Points)
Replied 07 June 2021
There would be no implication on the part of the company and the employee earning such leaves.
It would be considered as employee cost for the company and IFS for the employee
H.2017 R
(9 Points)
Replied 07 June 2021
For donee this helps in avoiding loss of pay...any impact on personal taxation...
CA. Heet Shah
(Tax Consultant & Practitioner)
(6180 Points)
Replied 07 June 2021
| Originally posted by : H.2017 R | ||
 |
For donee this helps in avoiding loss of pay...any impact on personal taxation... |  |
No Donee can't from his loss of pay on account of earned leaves transferred to other employee since it would be considered as part of his salary and same will also be shown in his form 16 .
H.2017 R
(9 Points)
Replied 07 June 2021
Could not understand. The purpose of leave gifting is to help other employees who are in need and exhausted their leave. Say medical reason. Those having surplus leave can donate to the needy one so that the beneficiary avoids loss of pay. This is as per company policy.. Hope I made clear
CA. Heet Shah
(Tax Consultant & Practitioner)
(6180 Points)
Replied 07 June 2021
| Originally posted by : H.2017 R | ||
|
Could not understand. The purpose of leave gifting is to help other employees who are in need and exhausted their leave. Say medical reason. Those having surplus leave can donate to the needy one so that the beneficiary avoids loss of pay. This is as per company policy.. Hope I made clear | |
Yes I understand Your concern but remember but donating all your salary you cant avoid your tax
Similarly the transfer of earned leaves is taxable in your hand as IFS and IFOS in the hand of reciver of Leave by way of GIFT unless an untill it is non monetary perk( even if you would have claimed the same it would have not been paid in encashed).
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