Hello Everyone,
I'm working as an HR Generalist in an IT company. Currently, in our salary structure, we have three monthly reimbursements: Sodexo, Health and Wellness, and Telephone allowances. We are looking to add Fuel allowance to provide tax benefits to employees.
Could you please inform me about the process, calculation, and the basis for tax exemption?
Thanks, Sandeep
From India, Mumbai
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I'm working as an HR Generalist in an IT company. Currently, in our salary structure, we have three monthly reimbursements: Sodexo, Health and Wellness, and Telephone allowances. We are looking to add Fuel allowance to provide tax benefits to employees.
Could you please inform me about the process, calculation, and the basis for tax exemption?
Thanks, Sandeep
From India, Mumbai
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There is no tax exemption for fuel allowance; it is a taxable perquisite.
If you need to make it exempt, you need to ask employees to submit their fuel bills and take reimbursement from the company. It is always better to let that be handled by accounts and don't add it to the Salary Slip or transfer during salary.
Procedure - it depends on your internal rules. In most cases, you need to get it approved by the top management or by HR Head and then communicate it to all employees. Ensure you put in a line that anyone who does not agree with the change needs to communicate it within 7 days. That will ensure that everyone is assumed to have agreed to change in the salary structure.
From India, Mumbai
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2498If you need to make it exempt, you need to ask employees to submit their fuel bills and take reimbursement from the company. It is always better to let that be handled by accounts and don't add it to the Salary Slip or transfer during salary.
Procedure - it depends on your internal rules. In most cases, you need to get it approved by the top management or by HR Head and then communicate it to all employees. Ensure you put in a line that anyone who does not agree with the change needs to communicate it within 7 days. That will ensure that everyone is assumed to have agreed to change in the salary structure.
From India, Mumbai
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Tax Exemption (SUPERB).doc
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