Tax paid by co on employees behalf a non-monetary perquisite

Nov 27 2012, 03:04 IST
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SummaryWell, the Indian Companies Act, 1956, by means of Section 200 restricts companies registered under it from paying its employees tax-free salaries.

Tax Act, 1961. In case of secondments to different countries, it is a common practice for employers (globally) to tax equalise or tax protect their employees from differential tax liabilities arising due to the tax laws of two countries (home and host).

Hence, greater clarity on the issue of tax payment in India will help companies develop or operate global policies while seconding employees to India.

The author is senior tax professional, Ernst & Young. Views expressed are personal

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