payment of gratuity act - Page 3

Gratuity – Legal Provisions and Taxation

ratuity is a reward for long and meritorious service. In 1972 the government passed the Payment of Gratuity Act that made it mandatory for all employers with more than 10 employees to pay gratuity. Gratuity shall be payable to an “employee” on the termination of his employment...

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Posted Under: Income Tax | ,

Provision for retirement benefit based on service weightage not allowable

CIT Vs M/s. Pricol Ltd. (Madras High Court)

As far as the expression 'gratuity' is concerned, there is no definition of what 'gratuity' is, even under the Payment of Gratuity Act; yet, a monetary relief to an employee at the time of his retirement or termination of service is treated as 'gratuity'....

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Forfeiture of gratuity for loss sustained illegal

The Payment of Gratuity Act, 1972, did not provide for forfeiture of gratuity amount due to employees in any other contingency except the one covered under Section 4(6), viz., recovery of dues from them. Also, the law stipulated that for invoking the...

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Posted Under: Income Tax |

Employers have to pay Interest for delayed payment of Gratuity

An employee becomes eligible for gratuity on the termination of his employment after he has rendered continuous service for not less than five years, according to Section 4(1) of the Payment of Gratuity Act, 1972. He is also entitled for interest on ...

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Posted Under: Income Tax |

Post Amendment all you want to know about taxability of gratuity payment

Meaning of Gratuity :-Gratuity refers to the emoluments received by an employee from his employer in gratitude for the services rendered. Such sum can be paid on retirement, resignation, superannuation, death or disablement. Under the Gratuity Act, the sum can be paid only after an employee has rendered continuous service of not less than...

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Posted Under: Income Tax |

Amendments to Payment of Gratuity Act- Accounting implications

In India, the Payment of Gratuity Act, 1972 (Act) requires entities with ten or more employees to pay gratuity benefit to their employees at the time of termination of employment. The act also provides that if an entity is covered under the act because its number of employees exceeded ten on a particular day, it will continue to be covere...

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Posted Under: Income Tax |

Revised Gratuity Exemption Limit for employees covered under the Payment of Gratuity Act, 1972

In respect of other employees, it is to be determined whether they receive gratuity from an employer covered under the Payment of Gratuity Act, 1972 or not. It is pertinent to note that every gratuity payment received by an employee is not exempt from tax per se. In this context, it is important to note the provisions of the Payment of G...

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Posted Under: Income Tax |

Tax treatment of Gratuity after Increase in limit from 3.50 lakh to 10 lakh

The government notified the Payment of Gratuity (Amendment) Act, 2010 on May 18, 2010, which increases the limit of gratuity payment to employees in the specified sectors/establishments covered under the Payment of Gratuity Act, 1972 (“Gratuity Act”). After the amendment, these employees are eligible to receive gratuity up to Rs 10,0...

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Posted Under: Income Tax |

Gratuity Amount payable under Payment of Gratuity Act enhanced from Rs.3.5 lakhs to Rs 10 lakhs

It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.Amendment of section 4 of Act 39 of 1972.2. In section 4 of the Payment of Gratuity Act, 1972, in sub-section (3), for the words “three lakhs and fifty thousand rupees”, the words “ten lakh rupees” shall be substit...

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Posted Under: Income Tax |

Rajya Sabha approves increase in Gratuity Limit to Rs. 10 Lakh

Parliament on Wednesday approved enhancing the gratuity limit for employees from Rs3.5 lakh to Rs10 lakh as also the exemption threshold from income tax on it. Parliament on Wednesday approved enhancing the gratuity limit for employees from Rs3.5 lakh to Rs10 lakh as also the exemption threshold from income tax on it....

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Posted Under: Income Tax |

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