Latest Expert Exchange Queries

Make your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
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: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: list of goods taxed at 4% :: due date for vat payment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4% :: ACCOUNTING STANDARDS :: empanelment :: VAT Audit :: Central Excise rule to resale the machines to a new company :: ACCOUNTING STANDARD :: articles on VAT and GST in India :: TDS :: cpt :: VAT RATES
 
 
« News Headlines »
 Income-tax (21st Amendment) Rules, 2017
 Deadline for filing income tax return nears; here are 10 common mistakes that you must avoid
 All you need to know about form 26AS
 How to file income tax return?
 7 changes that affect income tax return filing this year
 How To File Income Tax Return (ITR) Online For FY2016-17? Last Date July 31
 Last date for filing income tax return approaches: What is Form 26AS? How it can help you claim refunds
 Income Tax department to launch mobile app to make life easy for taxpayers
 6 things to remember while filing your income tax return
 Want to save on tax? Here are deductions you can use while filing ITR
 July 31 Is Last Date For Filing Tax Return. Why Form 26AS Has To Be Checked

Fringe benefit tax on stock options to hit MNC expats
September, 27th 2007
The fringe benefit tax (FBT) on employee stock option plans (Esop) could hit expatriate employees of multinational companies as credit cannot be claimed against it under double taxation avoidance agreements (DTAA).

Thus, expat employees of multinationals who have received stock options could end up paying tax twice: once as FBT and the second time as income tax in the homeland. This is because the government has allowed employers to pass on the cost to their employees.

Otherwise, FBT has to be paid by employers. Most of the developed countries like the US and the UK treat stock options as a perk and tax it in the hands of the employee. MNCs who have issued stock options to expat employees located in India include Coke, Dell and Adobe.

While some employers may be benevolent and pay FBT themselves, others may ask employees to bear the burden. Incidentally, none of the tax treaties recognise FBT. Thus, entities cannot claim credit against it in their homeland as they can do for income tax.

Says Ernst & Young partner Amitabh Singh, "Expatriates who continue to be taxed residents in their home countries will be taxed there upon exercise. Imagine their plight if, at the same time, their Indian employers recover FBT payable in India. Since the FBT is not eligible for foreign tax credits, almost 50-60% of their gains, and that too notional gains, will be gone. I am sure many expatriates will reconsider their deputation to India if this is the case. I feel the government should consider issuing appropriate clarifications to allow such FBT recovery to be considered eligible for tax credits."

According to existing provisions, FBT liability arises when an employee exercises the stock option given to him. FBT is applicable on all fringe benefits given by companies to their employees based in India. The country has opted for taxation of fringe benefits at the level of the employer as it makes collection easier. FBT on Esops has to be paid at the rate of 30%.
 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Content Management System development CMS development Content Management Solutions CMS Solutions Content Management Services CMS Services CMS Software

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