KEY DIFFERENCE BETWEEN ALLOWANCES AND PERQUISITES #cainter #csexecutive #cmainter #salary #catax

Definition An additional amount of money given at regular intervals, along with the salary, is referred to as an allowance. Employers may offer minor advantages or extras to their employees, which are provided for free and in addition to their regular salary. These are commonly referred to as perks NATURE Allowances are payments made by the employer to the employee to cover certain expenses, such as house rent, conveyance, medical expenses, or travel expenses. Perquisites are additional benefits the employer provides in the form of goods or services, such as accommodation, a company car, or club memberships. Taxation Allowances are taxable as part of the employee's income, but some allowances may be exempt from tax up to a certain limit. Perquisites are subject to valuation. The value of the perquisite is added to the employee's taxable income. Documentation Allowances are typically documented as part of the employee's salary structure, and the employee may need to provide documentation to claim tax exemptions. Perquisites are typically documented separately from the salary structure. Their valuation and tax implications are calculated separately. #taxation #taxationinindia #tax #TAXONSALARY #incometax #directtax