03 August 2009

Rachita: FBT

I need some clarification on Income tax- in view of the ammendments by the Budget 2009-10.

FBT has been abolished from the FY 2009-10. It is also proposed to restore the fringe benefit as perquisite in the hands of the employee( e.g. ESOP, contribution to approved superannuation fund, to the extent it exceeds Rs. 100,000, any other which is specified)

In this context, what will be the treatment of salary components in the nature of reimbursements( e.g. fuel charges, travel, telephone etc.). Earlier all these were treated as fringe benefit. In view of the recent changes, should all such reimbursements be treated as perquisite or will it be tax free till further notification? Will the earlier provisons apply?

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