Came to know from my payroll agency as well as from my CA that there is a new ruling on meal vouchers limiting them to Rs 50 per meal. Spoke to the meal voucher provider and they seem to be advicing for more than one meal per day and hence we can safely provide Rs 100 per day. My payroll agency as well as CA are saying that if a normal working day is of 8 hours (officially) how can you provide more than one meal a day? The meal voucher provider has denied providing a legal opinion on this that they used to provide earlier from credible legal firms. Am stuck as I have already given my employees about Rs 100 per day and this ruling is effective April 2009. I are terribly stuck! I don't want to tax the employees on meal vouchers in excess of Rs 50 that they have enjoyed as a tax free perk since the begining of this fiscal. Can anybody guide me on how you have been able to handle this without an employee irate? I want to solve this and am resolved to remove this perk from the next fiscal. Are there any other alternatives?
From India, Mumbai
From India, Mumbai
Hi Mr. Mishra,
I am also in a similar situation and stumbled up on your thread. Hoping that you have found answers to the problem by now would you mind sharing it with me.
Thanks in advance,
Vineeth Modon
From India, Bangalore
I am also in a similar situation and stumbled up on your thread. Hoping that you have found answers to the problem by now would you mind sharing it with me.
Thanks in advance,
Vineeth Modon
From India, Bangalore
Hi Vineeth, there are lots of legal opinion present with the service provider to substiate Rs 100 / day. I am using Sodexo and they have provided substantial supportings for the same. Regards, Gautam
From India, Mumbai
From India, Mumbai
Dear All,
I.T.rule 3(7)(iii),
(iii) The value of free food and non-alcoholic beverages provided by the employer to an employee shall be the amount of expenditure incurred by such employer. The amount so determined shall be reduced by the amount, if any, paid or recovered from the employee for such benefit or amenity:
Provided that nothing contained in this clause shall apply to free food and non-alcoholic beverages provided by such employer during working hours at office or business premises or through paid vouchers which are not transferable and usable only at eating joints, to the extent the value thereof either case does not exceed fifty rupees per meal or to tea or snacks provided during working hours or to free food and non-alcoholic beverages during working hours provided in a remote area or an off-shore installation.
There is no restriction on how many meals can be consumed each day. two meals per day during working hours is considered reasonable. That's why many companies do not deduct tax upto 3000/- p.m.
pon
From India, Lucknow
604I.T.rule 3(7)(iii),
(iii) The value of free food and non-alcoholic beverages provided by the employer to an employee shall be the amount of expenditure incurred by such employer. The amount so determined shall be reduced by the amount, if any, paid or recovered from the employee for such benefit or amenity:
Provided that nothing contained in this clause shall apply to free food and non-alcoholic beverages provided by such employer during working hours at office or business premises or through paid vouchers which are not transferable and usable only at eating joints, to the extent the value thereof either case does not exceed fifty rupees per meal or to tea or snacks provided during working hours or to free food and non-alcoholic beverages during working hours provided in a remote area or an off-shore installation.
There is no restriction on how many meals can be consumed each day. two meals per day during working hours is considered reasonable. That's why many companies do not deduct tax upto 3000/- p.m.
pon
From India, Lucknow
Do agree with Pon1965, If there are eight working hours e.g. 8 am to 4 pm, Company can provide breakfast and lunch and if multi-shift company, it can be lunch+dinner.
Also As per Income Tax Rule 3(7)(iii) word used is “Working Hours” and not “Normal Working Hours” Thus includes overtime working hours too. That means if one stay late beyond normal working hours and work till 10.00 pm in night, He can avail three meals a day, But if company wants to adopt it a general policy, It should get reflected in company policy very clearly, as well they must have sound attendance system to prove that all transactions are genuine, otherwise amount in excess of Rs.50 can be treated as perquisite and taxed.
Regds,
Sukhvinder Singh Bhatia
From India, Delhi
Also As per Income Tax Rule 3(7)(iii) word used is “Working Hours” and not “Normal Working Hours” Thus includes overtime working hours too. That means if one stay late beyond normal working hours and work till 10.00 pm in night, He can avail three meals a day, But if company wants to adopt it a general policy, It should get reflected in company policy very clearly, as well they must have sound attendance system to prove that all transactions are genuine, otherwise amount in excess of Rs.50 can be treated as perquisite and taxed.
Regds,
Sukhvinder Singh Bhatia
From India, Delhi
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