How will the fringe benefit tax be calculated?  

How will the fringe benefit tax be calculated?

The value of fringe benefits shall be the aggregate cost incurred. That is, the total expense deducted will be considered for purposes of levying fringe benefit tax. From this, a certain percentage will be deducted. The difference therein will be taxed at the rate of 30%.

However, the fringe benefit tax rate varies from 10 per cent to 50 per cent depending upon the expense incurred: For example, for the use of telephones 10 per cent fringe benefit tax will be charged, while entertainment expenses, festival expenses, gifts, use of club facilities, etc will be taxed at the rate of 50 per cent.

Answered by Om Prakash at 6:43 PM on September 26, 2008

The value of fringe benefits shall be the aggregate cost incurred. That is, the total expense deducted will be considered for purposes of levying fringe benefit tax. From this, a certain percentage will be deducted. The difference therein will be taxed at the rate of 30%. However, the fringe benefit tax rate varies from 10 per cent to 50 per cent depending upon the expense incurred like for the use of telephones 10 percent fringe benefit tax will be charged, while entertainment expenses, festival expenses, gifts, use of club facilities, etc will be taxed at the rate of 50 per cent.

As the FBT is levied on gifts or freebies given to the employer or client. The festive roar arising out of corporate offices this season may be somewhat doused by the fringe benefit tax, which has to be paid on corporate gifts. India Incorporation fears it will lose a lot of gambol this festival season as the fringe benefit tax on promotion offers and gifting crumple its ability to come out with high- decibel campaigns.

Big-time advertisers especially makers of consumer electronics items and fast moving consumer goods have been groaning about the impact of the FBT on their festival-season sales. Consumer durable companies that give away freebies such as a DVD player , colour TV or film / music software with a player etc could be asked to pay FBT on expenditure incurred on free offers.

For more information-
http://www.gifts naccessories.com/newyear-gifts /1374.htm

Answered by Nagendra at 7:41 AM on September 24, 2008

Yes, Esops will attract fringe benefit tax at the time you exercise your option ... the net profit and loss is calculated after taking into account all the Fringe benefit tax will apply to foreign companies if it has employees based ... the value of fringe benefit shall be calculated at “cost” of which the same Fringe Benefit tax- A bitter pill. Posted online: Sunday , June 05, ... included in the taxable value, depreciation should be calculated on a monthly basis

Answered by Vipan Thapar at 8:58 PM on September 23, 2008

Well Bhupindar! Fringe Benifit Tax is also known as FBT. The taxation of perquisites -- or fringe benefits -- provided by an employer to his employees, in addition to the cash salary or wages paid, is fringe benefit tax.

Any benefits -- or perks -- that employees (current or past) get as a result of their employment are to be taxed, but in this case in the hands of the employer.

Calculation of Fringe Benefits tax:-
The value of fringe benefits shall be the aggregate cost incurred. That is, the total expense deducted will be considered for purposes of levying fringe benefit tax. From this, a certain percentage will be deducted. The difference therein will be taxed at the rate of 30%.

However, the fringe benefit tax rate varies from 10 per cent to 50 per cent depending upon the expense incurred: For example, for the use of telephones 10 per cent fringe benefit tax will be charged, while entertainment expenses, festival expenses, gifts, use of club facilities, etc will be taxed at the rate of 50 per cent.

Information collected from http://www.rediff.com/money/2005/ma r/22spec.htm

Answered by Hemant Kumar at 12:59 PM on September 23, 2008

The value of fringe benefits shall be the aggregate cost incurred. That is, the total expense deducted will be considered for purposes of levying fringe benefit tax. From this, a certain percentage will be deducted. The difference therein will be taxed at the rate of 30%.

However, the fringe benefit tax rate varies from 10 per cent to 50 per cent depending upon the expense incurred: For example, for the use of telephones 10 per cent fringe benefit tax will be charged, while entertainment expenses, festival expenses, gifts, use of club facilities, etc will be taxed at the rate of 50 per cent.

Answered by Ashwani at 5:41 AM on September 23, 2008