Dear Experts,
I am working with Baumuller India Pune, we are manufacturing of Motors, Drives & PLC's.
Approx. 55 - 60 all types of employees are working. I have few questions & doubts related to nominal canteen deduction from salaries, are as follows:
Before going further, I want to give you an idea about the current practice of the canteen -
1. We do have a canteen facility for each employee and (free facility - for the last 8 years) for which the company has not deducted a single rupee for the same to date.
2. The facility we are getting through vendor is really good in all manners like taste, hygiene, quantity etc..
3. The vendor is running a business in small quantity like our 30 to 35 servings per day (rest are bringing Dabba from home) + their own mess members (about mess we are nothing do with it).
4. Being small business holder, they share only Invoice on monthly basis. (NO GST Bill / Invoice)
5. Current charges are Rs. 80/- per person and they are asking for Rs. 90/- per person and company is ready to pay.
6. But employee has no value for the same and due to that Canteen Committee decided to charge the some costs to employees like Rs. 250/- or 300/- per month (whether anyone want to avail the facility or not, charges will be applicable to each of them as charges are nominal and Food + Tea/coffee - 2times)
Now my doubts are considering above scenario -
1. Can we charge these nominal charges to employees?
2. Can we show the canteen deduction under salary slip heads?
3. If there are no Canteen Deductions on the payslip, then can we show them under other deductions? What would be the best option to reflect in the payslip?
4. I got to know, the vendor doesn't have GSTIN or provide Invoices with GST charges, then we as a company can not charge or recover the canteen amount of Rs. 250/- pm from the employees? is this so?
5. And if we want to recover this amount, then the vendor should have a GST number and invoices with GST charges. Really like this?
Please need your help for the same..
Archana Bapat
From India, Pune
I am working with Baumuller India Pune, we are manufacturing of Motors, Drives & PLC's.
Approx. 55 - 60 all types of employees are working. I have few questions & doubts related to nominal canteen deduction from salaries, are as follows:
Before going further, I want to give you an idea about the current practice of the canteen -
1. We do have a canteen facility for each employee and (free facility - for the last 8 years) for which the company has not deducted a single rupee for the same to date.
2. The facility we are getting through vendor is really good in all manners like taste, hygiene, quantity etc..
3. The vendor is running a business in small quantity like our 30 to 35 servings per day (rest are bringing Dabba from home) + their own mess members (about mess we are nothing do with it).
4. Being small business holder, they share only Invoice on monthly basis. (NO GST Bill / Invoice)
5. Current charges are Rs. 80/- per person and they are asking for Rs. 90/- per person and company is ready to pay.
6. But employee has no value for the same and due to that Canteen Committee decided to charge the some costs to employees like Rs. 250/- or 300/- per month (whether anyone want to avail the facility or not, charges will be applicable to each of them as charges are nominal and Food + Tea/coffee - 2times)
Now my doubts are considering above scenario -
1. Can we charge these nominal charges to employees?
2. Can we show the canteen deduction under salary slip heads?
3. If there are no Canteen Deductions on the payslip, then can we show them under other deductions? What would be the best option to reflect in the payslip?
4. I got to know, the vendor doesn't have GSTIN or provide Invoices with GST charges, then we as a company can not charge or recover the canteen amount of Rs. 250/- pm from the employees? is this so?
5. And if we want to recover this amount, then the vendor should have a GST number and invoices with GST charges. Really like this?
Please need your help for the same..
Archana Bapat
From India, Pune
The free food given to the employees has become a customary benefits and one of the conditions of service. Therefore, changing it will require notice u/s 9A of the Industrial Disputes Act. It is a fact that on account of cost increase the vendor may not be able to supply food at the same price at which he has been giving it. Moreover, the amount of increase is reasonable as well as genuine. I don't know what is the GST implication to it but I would say that cost of food provided free of cost or at concessional rate can be recovered from the wages of respective employees. But in your case, since a system of free food has been in place, you cannot make it subsidised rate without giving notice (21 days prior to implementation) to the workers with copy to Labour Officer and Union, if any. If you do not have a Union, then you can call a meeting of the workers and take them into confidence and make necessary changes in the food policy. It is always desirable that you should have a uniform system for all the employees and when there are a few employees who are not taking food from the canteen, they will think that they are in loss when compared to those who regularly take free food from the canteen. If the cost of food is not included in the wages, there would be disparity. That can be removed by adding the cost of food in the wages and then deducting a nominal amount from the wages of those who avail food.
Taxability of any free food, being a perquisite on the hands of employee, may be discussed with your Chartered Accountant.
From India, Kannur
4293Taxability of any free food, being a perquisite on the hands of employee, may be discussed with your Chartered Accountant.
From India, Kannur
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals. CiteHR connects professionals facing similar challenges, leveraging a vast knowledge base (100K+ downloads, 150K+ discussions) and targeted emails to engage experts in solving issues.
Queries-intervi ews_154.doc
1001-beauty-tip s-free-giveaway .pdf