Compensation & Benefits

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Josephine Harrison
6 years ago
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1 ;; Sri Ganeshji : Sri Balaji : Sri Pitreshwarji : Sri Durgaji : Sri Venkateshwara Compensation & Benefits General Questions... 2 Special Benefits Expense Heads... 3 Medical Reimbursement... 3 Conveyance or Vehicle Costs... 4 Phone Bills... 6 Communication Expenses... 7 Books & Periodicals... 8 Holiday Expenses... 8 Education Expenses... 9 Page 1 of 10

2 General Questions 1. Why do we need to submit supportings? These come under the purview of Income Tax and we would require to have the bills/receipts based on which you claim. These are maintained for a period of 8 10 years. That is why it is important to organize them well and submit them in a proper order. 2. What are the aspects I should take care of while submitting supportings? Arrange your supportings in the same order as you have entered them in ESS (SBC application). Write the SBC claim number on each bill/supporting document followed by the serial number. Example: SBC/10723/ , SBC/10723/ , SBC/10723/ etc. Attach a photocopy of bills on thermal paper (toll receipts, etc.) Staple them together, put them in the SBC envelope and staple the envelope. On the envelope, write your name, employee id and claim number (e.g. Claim Number: SBC/NNNNNNN). 3. Where and when do I submit the SBC supportings? Please drop these envelopes in the BOX kept at your location. The supporting documents/bills should be submitted within 7 days of the claim. 4. What happens if I do not submit supportings? Your claim will not be processed and paid till the supporting is received. 5. Can I claim multiple expenses in one SBC? Multiple expense heads can be clubbed (and multiple bills under each of these heads) in one SBC. One SBC claim (on ESS) can take up to 45 entries. It is a good practice to claim all expenses for a month in one SBC (or 2 SBCs if there are more than 45 bills). Document pertaining to each SBC claim/application should be submitted in separate envelopes. 6. Can I use self attestation? If so, when? Self-attestation is normally NOT allowed. However, in a rare instance when you have misplaced a bill you may use self attestation with relevant details of the claim nature of expense, why the bill is not available, etc. It should have all the details and should not necessitate further questions/clarifications. Repeated usage of self attestation will be questionable and the claim may be disallowed. 7. I had made a mistake in my SBC by oversight. Claimed a bill twice (realised it while submitting the supportings). How do I reverse this? If you have just submitted the claim and the status is payment pending, you should be able to get the claim moved to draft and edit it. Then there is no reversal required. However, if it has gone into payment in progress or payment successful mode, then you need to do a reversal. Process to opt for SBC Reversal: Step 1: Select your SBC Application (ESS Application Self Any) for which you want to do reversal. Step 2: Click on 'Do Reversal' option on that claim). You will see the details of bills and expenses you have claimed. Step 3: Enter the actual/correct amount which you should have claimed Step 4: Click on 'Submit Reversal' Page 2 of 10

3 Special Benefits Expense Heads Medical Reimbursement 1. Who are considered dependents for the purpose of Medical Reimbursement? Dependents, for the purpose of Medical Reimbursement can be any or all of the following, as applicable to an individual: a. Self (employee) b. Spouse c. Dependent Children (own or legally adopted children) up to the age of 21 years. If the child is employed or if the girl child is married, he or she CANNOT be a dependent. However, if children older than 21 but are doing full time studies can be considered dependent, up to the age of 26 years. d. Dependent Parents. They would be considered dependent if you support them financially on a regular basis. 2. What should I do if the medical bills are not in my name? These were medicines bought for my father/mother. Please mention your relationship with him/her, on the bill(s), as well as in the comments while claiming. 3. When I buy medicines, sometimes, I also buy non-medicinal items (shampoo, soap, etc.). What should I do when I claim/submit these medical bills? Non-medicinal items should not be claimed. If possible, get separate bills for medical and nonmedical items. Else, reduce the cost of these from the bills and claim the balance. It would be a good idea to write Amount claimed: on the bill before submitting it, so that it is clear if the claim gets picked for audit. 4. Can I claim bills for alternative medicine (such as Ayurveda, Homeopathy, etc.)? Yes. These can be claimed, provided these are proper treatments/medications and there are prescriptions, bills, etc. 5. I buy Protinex and Chyawanprash for my children. Can I claim these? Self-prescribed medication (that is not prescribed a doctor) including dietary supplements (such as Protinex) cannot be claimed 6. I got my eye tested and had to buy spectacles. Can I claim this? Yes. These can be claimed. Page 3 of 10

4 Conveyance or Vehicle Costs 1. What expenses can be claimed under Conveyance? This covers expenses towards fuel, non-insurable vehicle maintenance, vehicle insurance premium, parking charges and toll charges (incurred while on official duty), for the one declared vehicle. 2. Is maintaining conveyance log mandatory? Why? Yes. As mentioned earlier, the tax applicable on conveyance is borne by the company. Conveyance log data provides the information on what is taxable and what is non-taxable. 3. There are sub-options on the ESS screen while claiming conveyance. What should I select? There are 3 sub-options: Fuel Cost: Select this category while you claim Petrol/Diesel/Gas bills. Maintenance/Insurance: Select this option while you claim your vehicle maintenance and insurance related bills. When you claim vehicle maintenance, insurance, etc., the vehicle number should be indicated on the bill(s). Public Transport & Others: Select this while you claim conveyance for Bus, Auto, Train, etc. This also covers parking charges, toll charges and metro/train/bus pass. 4. I had traveled over a weekend and some of my fuel bills are from another city/state. Can I claim these? No. These cannot be claimed under Conveyance. In case it happens to be an official trip, it should be claimed separately as Business Travel Expenses and not as SBC. You would be required to provide sufficient details about the purpose and why travel by car, etc. 5. How do I claim conveyance expenses incurred when I was on official travel (not in my location but other cities/states)? These should be claimed as a part of business travel expenses. 6. I have more than one vehicle in my name. I use these vehicles alternatively for official travel. Can I claim expenses for both vehicles? Expenses can be claimed \for ONLY one vehicle. This should be your regular mode of transport, and the details updated on your HRIS profile Conveyance Details. 7. Can I claim State Change Road Tax for my Vehicle under Conveyance/Vehicle cost? No. Road tax is considered a part of cost of acquiring a vehicle. Hence cannot be claimed. Conveyance Reimbursement is purely for your 'operating' or 'running costs'. 8. Can I claim cost of helmet? Helmet is not an operating expense. Similarly, buying accessories for your vehicle cannot be claimed under SBC. Page 4 of 10

5 9. Can I claim car washing charges? No. This cannot be claimed under SBC. Similarly, changing upholstery, adding accessories, etc. cannot be claimed. They are not operational expenses. 10. Questions on usage of public transport (multiple questions clubbed): a. If I go from Office to Station/Airport/Bus Stand by Auto / Taxi, when I am going on leave/weekend, can I claim the expense? b. I use a two wheeler, but during weekend took my wife to the hospital by taxi when she was unwell. Can I claim the expense? c. If I am attending a seminar (on my own choice) over the weekend, can I claim conveyance? d. If I go from office elsewhere then go home, can I claim the expense? All the above are considered personal expenses and CANNOT be claimed under SBC. 11. I usually commute by car. But when I give my vehicle for service, I use my two-wheeler to commute. Can I claim the fuel expenses for this? Claiming fuel cost for two vehicles is generally not allowed. However, in such situations, when you give your vehicle for service and use another vehicle, please mention on this on the face of the bill so that it won t look like you are claiming for two vehicles. 12. I usually use public transport. However, I come by my vehicle to work on some days. How, do I claim such fuel expenses? The extent of such usage is difficult to be validated. However, please use your judgment and claim an appropriate bill/amount. Say one or two bills in a month depending upon the extent of usage. Page 5 of 10

6 Phone Bills 1. What should I provide as documents/bills when I claim phone bills? A bill that clearly indicates details/break up of amount being claimed should be submitted. There is no need to submit an itemized bill. However, in case of an audit requirement you should be able to produce the itemized bill. Also when the telephone bill is not in the name of employees, the relationship with the person (whose name the bills is) and the reason for using such a connection should be clearly indicated. 2. Is it mandatory to attach/provide proof of payment? Claim has to be made along with bill and proof of payment (Xerox copy of credit card statement or online transaction printout or reference number of online payment etc.) or in case of pre-paid where bill is not available the proof of payment has to be submitted. It would be a good practice to do online recharge so that it is easy to get the proof of payment. 3. What supportings should I provide for re-charging my pre-paid mobile connection? First, it would be advisable to avail the benefit of company-negotiated tariff plans/connections. Second, please re-charge online (especially since you are also entitled for Communication expenses). For online recharge, a print out of the confirmation screen should be attached. Any other mode of recharge is usually discouraged. However, if you use any of these, please try and get a bill from the shop, etc. Please ensure details of mobile number for which recharge was done, date of recharge, amount of recharge are all provided while claiming. 4. What do you mean by proof of payment? What should I provide if I pay online? When you pay online, most service providers send you an acknowledgement with amount and date mentioned. You can print that and attach. Or you can print the screenshot with confirmation of payment and attach it. 5. How do I claim for the office mobile phone? As of now the Company is paying the service provider directly. The bill amounts will be booked against the individual employees names towards their reimbursement entitlement/eligibility. 6. What all can I claim under the eligibility for mobile phone reimbursement? The monthly bill amount (rental and usage charges, normally). This can also include normal/minimum GPRS/2G internet charges. This Expense Head does NOT cover the cost of your handset, accessories, its loss, repair or any other related expense. 7. I only have a personal mobile with no official calls. Can I claim? Yes. This would be acceptable as long as it is reasonable and within your limits. 8. Can I claim my home landline telephone bill for the phone reimbursement purpose as my landline phone is registered under my name? The reimbursement is for ONE mobile phone. Only where the eligibility is given for Two phones, it covers your office mobile phone and an additional land line at your residence. If your entitlement is one mobile phone, only mobile phone expenses can be claimed. Page 6 of 10

7 Communication Expenses 1. I took a wireless internet connection. Can the cost of modem be claimed as a part of Communication expenses? What about various late fees? No. Only the cost of Internet usage can be claimed. Modem costs, Installation charges, deposits and advance payments cannot be claimed. Late fee, for any type of expense are not claimable. 2. I do not have internet connection at home. I go to a cyber café for browsing. Can I claim those expenses under communication expenses? Browsing expenses at cyber cafes cannot be claimed. This covers the expenses you will incur for having a Broadband or equivalent Internet access in your home. The intent is to simplify your ability to balance your home and office time without compromising or cramping your productivity. In the kind of business we operate, we have to occasionally be available or connected outside the normal working hours if we have to remain responsive and responsible. 3. My internet connection is in the name of my spouse. But I use it for work. Can I claim that? Yes. However, indicate your relationship with the person (whose name the connection is) and the reason for using such a connection. This information has to be provided every time you claim such a bill. 4. I have an internet connection at my native place in my Father s name. Can I claim that? I do not have a connection at Bangalore where I stay. No. This cannot be claimed. The special benefits are to be used for reimbursements of expenses as per objectives, and not as a matter of right. 5. What do you mean by proof of payment? What do I provide for online payments? You can indicate details of payment say cheque number or e-payment transaction number with date and amount on the bill. For online payments the e-payment transaction number with date and amount can be mentioned. Page 7 of 10

8 Books & Periodicals 1. For purchase of books, would it be sufficient if I provide the card swipe receipt? The detailed bill where names of books are visible and the receipt (proof of payment) are to be submitted as supporting. 2. Can I claim newspaper expenses, India Today, Outlook etc.? Only books/periodicals pertaining to technology/business/management can be claimed. By this definition, India Today, Outlook, etc. do not qualify to be claimed. 3. Can books for MBA courses be claimed under books and periodicals? If they are text books (even if they are given by the university, etc.) they cannot be claimed. Other reference books, if any, can be claimed. 4. Can text books bought for children be claimed under Books & Periodicals? No. Textbooks cannot be claimed under Books and Periodicals. If you are entitled to Education expenses reimbursement, children s text books can be claimed under that. Holiday Expenses 1. I am entitled for Holiday expenses reimbursement. If I drive down to some destination for a holiday and have incurred a considerable expenditure on petrol bills, can I claim it under Holiday Expenses? Weekend trips are not allowed. However, if it is a real holiday, the expenses can be claimed provided you have the bills. Self-attestation is not allowed under Holiday expenses. 2. My family (parents, spouse and children) went on a holiday. I did not travel with them. Can I claim these expenses? Preferably it should be a holiday for you, with your family. In the rare event that you were unable to travel due to work exigencies, you can write to a CLT, take prior approval and claim these expenses. The approval should also be attached along with the supportings. 3. I went to Delhi for my nephew s wedding for two days. Can I claim this under Holiday expenses? Such expenses should preferably be avoided from SBC claims. Holiday is oriented towards rejuvenation and should be for at least 3 5 days. Page 8 of 10

9 Education Expenses 1. I have enrolled for a project management course. Can I claim the expenses under Education expenses? No. Education expenses is meant to cover the cost of regular education of your children. Your own education is not covered under this. 2. My daughter is attending IITJEE preparation classes. Can this be claimed? No. Education Expenses Reimbursement covers pursuit of regular school/college education. Expenses incurred on preparatory courses, summer camps, etc., cannot be claimed. 3. My son s school mandated us to by books/note books from an outside shop. Can this be claimed? You can claim this expenses if you have (a) a detailed/itemized bills and (b) a circular/notice from the school recommending the specific books, etc. 4. How do I claim cost of uniform, cost of school transport, etc., spent for my children? You can claim these expenses with appropriate supporting documents. Self-attestation is not allowed. Page 9 of 10

10 Self Attestation Form Emp Id SBC Claim No. Emp Name Date of Claim Sl.No. Expense Type Date of Expense Amount Claimed Reason for self-attesting Note: Normally original bills have to be kept carefully and submitted. Only in extraordinary and exceptional circumstances should you use self-attestation You will be required to justify/explain in case of an audit query on the reason for self-attested bills Provide all relevant details/information so that this is self-explanatory and there is no need for clarifications. Please ensure that there is one item per payment you have made. Summaries not allowed. Signature: Date: Page 10 of 10

This guide will give you an overview of the types of expenses you can claim and how to claim them.

This guide will give you an overview of the types of expenses you can claim and how to claim them. GUIDE TO EXPENSES BUSINESS EXPENSES - AN OVERVIEW i4 Pay Partners Limited 71-75 Shelton Street Covent Garden London WC2H 9JQ «dummy» We have put this Guide together in line with all current HMRC guidelines