Hello friends Can someone clarify about the Component called "Soft furnishing allowance" in the Break-up of a Salary......... Regards Arpita
From India, Bangalore
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2From India, Bangalore
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Dear Arpita,
Earlier, companies used to pay a part of the salary in the form of a soft furnishing allowance to enable their executives to purchase soft furnishings like pillow covers, curtains, etc. However, now it has been made taxable; therefore, nobody is giving this allowance. If some companies are still doing it, they should stop because if they pay it without deducting tax, they will have to pay 33% of the amount as Fringe Benefit Tax, which could be equal to or more than the tax saved by the employee. Therefore, why continue with this allowance.
KKT
From India, Delhi
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Earlier, companies used to pay a part of the salary in the form of a soft furnishing allowance to enable their executives to purchase soft furnishings like pillow covers, curtains, etc. However, now it has been made taxable; therefore, nobody is giving this allowance. If some companies are still doing it, they should stop because if they pay it without deducting tax, they will have to pay 33% of the amount as Fringe Benefit Tax, which could be equal to or more than the tax saved by the employee. Therefore, why continue with this allowance.
KKT
From India, Delhi
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Thank you, KKT, for the response. This site is simply awesome. I mean to say, I get apt and concise answers for my queries, which is not possible even from Google.
Keep rocking.
Regards,
Arpita
From India, Bangalore
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Keep rocking.
Regards,
Arpita
From India, Bangalore
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Employee Benefits.doc
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