1 / 9

Introduction

Introduction. Rationale for FBT The Finance Minister stated the following while introducing the FBT legislation:

claudia-barrera
Télécharger la présentation

Introduction

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Introduction • Rationale for FBT • The Finance Minister stated the following while introducing the FBT legislation: “Therefore, by the presumptive tax method what we are trying to do is to tax that part which is clearly a perquisite, clearly a benefit but which is going untaxed both in the hands of the employer and the employee…..” • FBT levy is necessary to ensure that fringe benefit taxation does not violate horizontal and vertical equity. • This levy would bring to tax benefits that are collectively enjoyed and are not capable of being attributed to an individual employee.

  2. Introduction • Synopsis of the provisions • FBT is an “additional” income-tax payable by an ‘employer’ • FBT is a tax payable with effect from 1 April 2005, on • Fringe Benefits, and • Deemed Fringe Benefits • Fringe benefits are ‘deemed’ to have been provided to an employee in case an employer incurs specified expenditure • Perquisites on which tax is paid or payable by an employee are excluded from the ambit of FBT • FBT is leviable @ 30% (plus surcharge and education cess) on ‘value’ as prescribed

  3. Introduction • Value prescribed is either 5%/20% / 50% / 100% of the total expenditure • Synopsis of the provisions • FBT is applicable to • Company • Firm • AOP or BOI • Local authority • Artificial juridical persons

  4. Introduction • FBT not applicable to • An individual (whether or not books of accounts are audited) • A Hindu Undivided Family (whether or not books of accounts are audited) • A person whose income is eligible for exemption under section 10(23C) or registered under section 12AA • Central and State Governments • A political party • FBT is not a deductible business expenditure

  5. Fringe benefits defined

  6. Deemed Fringe Benefits

  7. Exclusions from Deemed Fringe Benefits

  8. FBT Amendments • No FBT on non transferable prepaid electronic meal cards usable only at eating joints • No FBT on the following expenses covered under staff welfare: • To provide crèche facility for employees’ children, • to sponsor a sportsman being an employee • to organise sports events for employees • No FBT on any expenditure for maintenance of guest house • Value of Fringe benefits for expenditure on festival celebrations reduced from 50% to 20%

  9. THANK YOU

More Related