Tax On Bonus & PL Encashment - CiteHR
Company Secretary, Hr, Legal, Finance
Payroll & Statutory Laws

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Dear Seniors, Pls. clarify whether Tax is to be deducted on Bonus paid and PL Encashment of the employee. Ramesh
Yes as per income tax act, tax is to be deducted on both - Bonus and EL. As they come under Gross Salary in Form 16. no exemption is available for these components.
Dear Ramesh,
What Ritu said is right? and another thing if company or client directly provide cash as gift to employee is should taken to TDS. otherwise employee can take any product and bill submitted directly to company for that gift encash is not taxble. but for company its FBT.

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