Whether expenditure on all guesthouses is liable to FBT or restricted to expenditure on holiday homes?
In terms of the provisions of clause (K) of sub-section (2) of section 115WB, FBT is payable on expenditure incurred for the purposes of maintenance of any accommodation in the nature of guest house other than accommodation used for training purposes. Therefore, expenditure on all guest houses is liable to FBT irrespective of whether they are used as holiday homes or not. 94. Whether the following expenses are liable to FBT: expenditure on provision of food at the guest house maintained by the employer; contract charges paid to guest house staff; and depreciation/rent of guest house building. In terms of the provisions of clause (K) of sub-section (2) of section 115WB, any expenditure incurred for the purposes of maintaining any accommodation in the nature of guesthouse other than accommodation used for training purposes is liable to FBT. Since the expenditure on provision of food at the guest house maintained by the employer, contract charges paid to guest house staff and rent paid or
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