Boss2966
Industrial Relations
Cite Contribution
Community Manager
Pon1965
Construction
Hemant_yadav
Recruitment, Training And Payroll
+2 Others

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I believe relocation expenses are those which are reimburesed to us as a benefit for joining the company, which are spent from our pocket. Why should these be taxable?
Are these expenses really taxable?

From United States, Buena Park
u/s 10(14) of I.T. rules, Allowance granted to meet cost of travel on tour or transfer is exempted from income tax. Regards R.Ponraj
From India, Lucknow
Thank you for the response. Can I also get a proper link which describes this section in detail and which is from Govt. of India IT? I should probably let my employer see this clause. Please let me know.
From United States, Buena Park
Refer here under the heading (iii) Allowances exempted u/s 10(14)
Directorate of Income Tax, RSP & PR, New Delhi
Regards
R.Ponraj

From India, Lucknow
I can see
(i) Allowance granted to meet cost of travel on tour or transfer.
But this doesn't tell anything about 'household movement expenses'. Does this by default included in 'cost of travel on tour or transfer'?
Please advice.

From United States, Buena Park
Dear Bharath ,
This may sound like an elaborate answer, but this how we did it .
  • Raise a request for the relocation benefit through the ERP .
  • Once the employee travels, he would submit the bills including the travel by air for family, truck/roadways bills for shifting household furnitures.
  • Cars and other vehicles owned by the employee , would be offered an amount. Though the octroi would not be a part of the amount.
  • The clearance would be made by the Finance team on submission of all the bills. The amount credited through the salary .
Moral of the story , the amount remained tax free subjective to the bills submission . Though there was a clause in the policy where it was mentioned, that if the employee leaves the company within a year of relocation, the amount would be recovered. But at is seems, its a retention strategy .
Do share if you have further queries.
Regards,
(Cite Contribution)

From India, Mumbai
That's pretty helpful. Thank you.
One last question please, all these applies to a movement
From Company A at City 1 TO Company B at City 2.
It doesn't really applies to 'internal transfers' - i.e., Company A at City 1 TO COmpany A at City 2. Am I correct?

From United States, Buena Park
Hi Bharath
their is no such rule in this. if the transfer is with the same company at different location,or different company at diffrent location, re-imbyrsement is always exempted.
hope i have answered your query.

From India, New Delhi
It is very clearly written in Income Tax rules as under
"Any allowance, whether granted on tour or for the period of journey in connection with transfer (including any sum paid in connection with transfer, packing and transportation of personal effects on such transfer)" is exempt.
Directorate of Income Tax, RSP & PR, New Delhi
Regards
R.Ponraj

From India, Lucknow
Whatever you have spent during the relocation due to transfer from one place to another place is only reimbursed and it may not be any allowance or pay.
Hence it is fully tax exempted.
With warm regards
S. Bhaskar
9099024667

From India, Kumbakonam

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