Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: cpt :: VAT Audit :: TDS :: Central Excise rule to resale the machines to a new company :: list of goods taxed at 4% :: due date for vat payment :: articles on VAT and GST in India :: form 3cd :: empanelment :: ACCOUNTING STANDARDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: ACCOUNTING STANDARD :: ARTICLES ON INPUT TAX CREDIT IN VAT :: TAX RATES - GOODS TAXABLE @ 4%
 
 
« News Headlines »
 Provisional Enrollment under Goods and Service Tax (GST)
 Ten income tax changes that will come in to effect from April 1
 New income tax provisions you need to be aware of
 8 benefits you must know about this tax-saving mutual fund
 10 most important income-tax changes which will apply from April 1
 Delhi: 54 CAs, company secretaries on radar in I-T crackdown against black money
 10 Income Tax Rules That Will Change From April. See Details Herea
 Looking for last-minute tax planning with Section 80C investments? Here's help
 Aadhaar mandatory for filing income tax return
 Will Aadhaar linkage solve India's income tax woes?
 GST roll out from July 1 will make goods cheaper: Jaitley

Tax paid by employer is not a perk: Tribunal
December, 22nd 2007
A Special Bench of the Delhi Income Tax Appellate Tribunal has ruled that the income tax that an employer pays on behalf of its employee is a non-monetary benefit in kind and, therefore, exempt from tax.
 
The Tribunals ruling will benefit multinational companies operating through liaison and sales offices and unregistered Indian companies, some of which are known to bear the tax costs for their employees.
 
However, registered companies are barred under law from bearing tax costs on behalf of their employees.
 
The ruling came on a petition of a company called RBF Rig, which paid salaries to some employees net of tax as the employer had borne the taxes.
 
In the tax returns filed by the employees, tax borne by the employer on the salary paid was considered a non-monetary benefit in kind and as such, exemption from tax was claimed under the Income Tax Act, 1961.
 
The tax officer and subsequently the Commissioner of Income Tax (Appeals) did not allow the exemption on grounds that the tax payment was a monetary benefit in kind. So employees were asked to pay tax on this perk at the applicable rate. The company appealed to the Tribunal against the order.
 
The Special Bench overruled two earlier decisions of the Delhi Tribunal, which had held that tax paid by the employer is a monetary payment and did not qualify for exemption. The bench said since the tax was paid to a third party (the government) and not the employee, it could not be considered a monetary benefit.
 
"There was some ambiguity in the law as to what could be regarded as a non-monetary benefit in kind. The Tribunal ruling will go a long way in bringing certainty into tax payments," said Gaurav Taneja, national tax director, Ernst & Young.
 
The Special Bench decision is a binding precedent for tax tribunals. However, a challenge to this ruling by the Income Tax department cannot be ruled out in a high court.
 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Achievements

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions