Gratuity

Reetu Dwivedi (Querist) 02 June 2012 This query is : Resolved
Dear Experts,

We receive Gratuity cheque from the third party vendor in the name of the Trust and Gratuity payment to Employees’ is made from Trust’s bank account. My question is

1. Is it necessary to pay interest from Trust’s bank account. Can the interest be paid from Company’s bank account ?

2. If interest can be termed as Gratuity ? That is, while calculating the TDS impact on the Gratuity basis the current tax free limit of 10 L, if interest payout to be included / excluded

Regards,
Surya

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Guest (Expert) 02 June 2012
Your question seems to be lacking some vital background information, as that does not indicate --

1) How your company came in to picture in respect of payment of gratuity to an employee when that was due to be paid by the third party vendor?

2) At which stage do you consider the interest payable on gratuity amount?

3) At what stage of employment/ termination of employee and when the company received the amount of gratuity from the third party vendor?

4) After how much period the gratuity was paid to the employee after receipt from the third party vendor? and

5) Total interest and gratuity amount that the company becomes liable to pay?

Reetu Dwivedi (Querist) 20 June 2012
Dear Sir,

The company issues cheque in the name of group gratuity trust, This Trust has an account with bank and bank issues cheque to the employees.

We pay interest after 30 days.

Regards

Anirudh (Expert) 20 June 2012
It is not at all clear as to why the interest is being paid after 30 days and to whom the same is being paid?

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