Employment tax services
Expertise shared. Expertise implemented
The new perquisite rules for financial year 2009-10 have been notified on December 18, 2009. The uncertainty that existed on determining the taxable value of benefits has now been addressed. The new rules essentially mirror the old rules that were in existence prior to the fringe benefit regulations; however, there are minor changes.
Organisations need to quickly grasp the changes, understand the implications, decide the action plan and move into the implementation mode. The tax withholdings have to be recomputed and shortfall to be recovered in the future months. Employees need to be informed of the changes with an accurate impact analysis. Employee exit settlements that took place during the year need to be reviewed and action plans formulated. Steps to reduce the employees’ tax cost need to be undertaken. There may also be a need to restructure compensation in view of the current changes.