There are many perks that come with working for a well-established company. One of the benefits is an annual meal allowance to be used as needed throughout one year!
This benefit includes tax exemption and can be spent on 2 meals per day. Enjoying tasty food while also saving money? Sounds like a win-win situation.
Let understand what meal allowance is and how it helps in taxation.
What is Meal Allowance?
Meal allowance can be provided by the employer through the provision of meals during office working hours or through pre-paid food cards or digital coupons. For example, if an employer gives you a meal voucher worth Rs 50 per meal, then it is not taxable.
An employer can give a food allowance. Sometimes employers provide food at work, or they can offer you a meal card or digital voucher for food.
In addition to receiving a great paycheck, some employers offer employees access to affordable and nutritious meals in their office cafeteria or nearby restaurant options through allowances from Meal Allowance coupons.
The daily meal allowance for employees in India in 2022 is Rs 50 per meal. The company provides employees with a fixed salary and tax-free meal coupons.
Meal Allowance For Employees 2022
Employers provide their employees with Meal Allowance or meal coupons to be used for two meals per day. The Annual Allowance is calculated at Rs 26,400 and it's tax-exempt when the employee gets them.
What is the Meal Allowance policy?
A meal allowance is a popular employee benefit offered by a number of organisations. The most preferred form of providing this benefit is the meal voucher or meal card.
Since meal vouchers and cards are not in the form of cash, the Meal benefit is not taxable in the hands of the employee.
Meal vouchers are a value-add in the salary package as they not only give employees a tax benefit but also let them enjoy a meal of their choice.
These vouchers can be used at a number of affiliate restaurants, food outlets and shops. Employees can use them to buy food and non-alcoholic beverages that they like.
Meal policy for employees - Specific rules and tax exemptions.
Meal Vouchers are used in a number of countries. In India, the Meal Voucher system was formally implemented in 2001.
It is regulated by the Income Tax Act under which meal vouchers up to a total amount of Rs.50 per meal for a maximum of 2 meals per day is tax exempt.
Companies can give more amount as meal benefit to their employees but any amount exceeding Rs.50 per meal will be taxable.
One meal per day: Rs.50 X 22 days = 1100/- per month tax free
Two meals per day: Rs.100 X 22 days = 2200/- per month tax free
Meal allowance since 1997
Year
|
Taxable on Employees
|
1997 to 2001
|
Tax free up to Rs.35 per day
|
2001 to 2005
|
Tax free up to Rs.50 per meal
|
2005 to 2009
|
Tax free up to Rs.100 per day
|
2009 to present
|
Tax free up to Rs.50 per meal (max. 2 meals per day)
|
As per the latest RBI mandate, meal vouchers will be replaced by meal cards, starting January 2018. No new meal vouchers will be printed and all pre-paid meal voucher issuing companies have to switch to meal cards to continue providing this service.
While all companies have to start to make the shift from meal vouchers to meal cards, it is noteworthy that Edenred, the issuers of Ticket Restaurant Meal Vouchers, made their shift to digital way back in 2014 when they first introduced their Meal Cards in India.
You can also consider Sodexo Meal Card for the meal allowance in salary for your employees.
Edenred will also be completely stopping the printing of its meal vouchers as per the RBI mandate and will go 100% digital with its meal benefits.
If you haven’t explored the many benefits of employee meal allowance and meal cards, check out the Edenred India website today to know more!
Still, confused about Employee Allowances? This post will help you to understand employee benefit allowances.
Still, confused about Employee Allowances? This post will help you to understand employee benefit allowances.
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