Zeta Optima provides a one-stop solution to administer various employee payroll allowances and reimbursements programs under one platform. It has a suite of products that help to manage various employee payroll benefits. The Optima platform is fully compliant with RBI, Income Tax, and Information Technology regulations.
Let us now examine some of the vital guidelines that we must abide by:
Regulatory Body | Description |
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Reserve Bank Of India (RBI) | The issuance of any form of paid vouchers in the entire country is governed by the guidelines set by RBI. |
Income tax (IT) | Income Tax rules govern the paid vouchers that are issued by financial institutions. IT guidelines dictate terms of the eligibility of the usage of paid vouchers under various Sections. |
Information Technology | The Information Technology act mentions that any organization which deals with the sensitive personal data of customers, has to follow proper procedures to ensure the security parameters. Organization will be liable to pay for the damages incurred in case of violation of the IT act. |
For Employee: As per the new RBI mandate, it is mandatory to update your identity details before February 28th, 2018 to continue receiving tax benefits on Zeta. Click here to know the steps to update identity details. For Employer: You have to validate any government issued valid ID of all employees receiving benefits from January 1st, 2018 and update the order file format for all PPIs to include the PAN/Aadhaar details of each employee. |
Zeta Meal Vouchers are semi-closed, reloadable, co-branded prepaid payment instruments (PPIs) issued by financial institutions and marketed & distributed by Better World Technology Pvt. Ltd (BWTPL). Let us now examine the Meal Card with respect to it's compliance with government regulations.
The following are extracts from the RBI's Draft Master Direction:
RBI Draft Master Direction |
Section 3(7)(iii) of the Income Tax Rules states:
Section 3(7)(iii) |
The below comparison table summarizes how the Zeta Meal Vouchers are the only 100% digital compliant solution, under the RBI guidelines and Income tax rules.
Paper Vouchers | Meal Cards | Zeta Meal Voucher | |
---|---|---|---|
RBI Compliant Income Tax Compliant Tax-Benefits to Employees | X √ √ | √ X X | √ √ √ |
Bank issued meal cards which are in the form of Debit / Pre-Paid card does not meet the definition of a voucher, as it is not a voucher. |
This benefit is extended by employers to employees for expenses related to telephone, mobile phone and internet bills. These are the following requirement to avail tax benefit on communication expense:
Let us now examine the Communication Card with respect to it's compliance with Government regulations.
Section 3(7)(ix) of Income Tax rules states:
Section 3(7)(ix) |
The Information Technology Act, 2000 states:
An electronic record can be authenticated by affixing the digital signature.
Electronic records can be used wherever a document is required.
If any information is to be retained for any specific period then such information must be accessible for subsequent reference.
An electronic record will be attributed to the person who sent it.
To view the Information Technology Act, 2000 click here. (Refer Page 4, 5, 6)
At Zeta, bill upload and approval is done electronically complying with the IT Act, 2000. All bill uploads, approvals, reimbursements and debits are digitally signed as per the regulations of the Information Technology Act. All bills are processed keeping highest process standards - ISO 27001:2013 process certified.
At Zeta, the scanned Communication bills are preserved in original format as uploaded by the employees. We do not modify these bills. These bills are tax saving documents which are stored permanently on Zeta servers and can be produced as originally uploaded.
The Optima Fuel & Travel Card is a digital card designed to help corporates to manage fuel and conveyance expenses program. Let us now examine the Fuel & Travel Card with respect to it's compliance with Government regulations.
Section 10(14) and Rule 2BB of Income Tax Rules states:
Fuel & Travel allowance is offered to employees of a company to compensate for their travel between residence and place of work up to Rs. 1,600 per month (Rs. 3,200 per month for blind, deaf, dumb and handicapped employees) and is tax exempted.
Fuel & Travel allowance is offered to employees over and above their basic salary component.
It is paid by an employer only if the there is no transportation provided by the employer. In case an employer offers office transport, conveyance allowance will not be provided to employees.
Fuel card don’t expire unless otherwise specified by your organization.
Section 10(14) |
There are mainly 3 factors determining the taxation policies for Fuel and Travel allowance: -
In case employee owns a car, the following conditions have to be met to claim reimbursement:
The vehicle should be registered in the name of the employee and a copy of the RC (Registration Certificate) book must be submitted as proof of the same.
An Employee can claim for more than one vehicle, provided they are registered in his name.
As per Section 17(2)(iii) with Rule 3(2), the following reference amounts are considered as non-taxable fuel reimbursement limit:
Below 1.6 liters (1600 cc) - Rs. 1800/- per month
Above 1.6 liters (1600 cc) - Rs. 2400/- per month
Chauffeur, if any - Rs. 900/- per month
Section 17(2)(iii) with Rule 3(2) |
The Information Technology Act, 2000 states:
An electronic record can be authenticated by affixing the digital signature.
Electronic records can be used wherever a document is required.
If any information is to be retained for any specific period then such information must be accessible for subsequent reference.
An electronic record will be attributed to the person who sent it.
To view the Information Technology Act, 2000 click here. (Refer Page 4, 5, 6)
Driver's salary paid by employees are exempt from taxes, and can be reimbursed by the company. The income tax law pertaining to driver’s salary is Section 17(2)(iii). Below is the summarized illustration related to this specific law.
Section 17(2)(iii) |
Zeta Optima Leave & Travel Allowance (LTA) Card is a paperless and digital solution designed to facilitate organizations to allow employees to claim their LTA expenses electronically. Let us now examine the Leave & Travel Allowance Card with respect to it's compliance with Government regulations.
Section 10(5), Chapter 3 states:
Section 10(5), Chapter 3, 1961 |
Certain conditions have to be met under Rule 2(B) for the purpose of Section 10(5).
Rule 2(B) |
The Information Technology Act, 2000 states:
An electronic record can be authenticated by affixing the digital signature.
Electronic records can be used wherever a document is required.
If any information is to be retained for any specific period, then such information must be accessible for subsequent reference.
An electronic record will be attributed to the person who sent it.
To view the Information Technology Act, 2000 click here. (Refer Page 4, 5, 6)
The Asset Card is a perquisite that helps employees to save income tax on purchase of electronic items and verifying their claims thereafter by uploading the relevant bills. Let us now examine the Asset Card with respect to it's compliance with government regulations.
Section 17(2)(vii) of Income Tax Rules states:
Section 17(2)(vii) |
The Information Technology Act, 2000 states:
An electronic record can be authenticated by affixing the digital signature.
Electronic records can be used wherever a document is required.
If any information is to be retained for any specific period then such information must be accessible for subsequent reference.
An electronic record will be attributed to the person who sent it.
To view the Information Technology Act, 2000 click here. (Refer Page 4, 5, 6)
The Books & Periodicals Card digitizes the whole process of claiming reimbursements for expenses on books and periodicals purchased for official purposes. Let us now examine the Books & Periodicals Card with respect to it's compliance with Government regulations:
As per the Income Tax Act Section 10(14) in India, it is non-taxable if bills are submitted to and stored by an employer.
There is no limit set by the Income Tax department on Books & Periodicals.
However, a corporate can choose to set a limit for their employees according to their company rules.
Guideline Residual Clause of Section 10(14) |
The Information Technology Act, 2000 states:
An electronic record can be authenticated by affixing the digital signature.
Electronic records can be used wherever a document is required.
If any information is to be retained for any specific period then such information must be accessible for subsequent reference.
An electronic record will be attributed to the person who sent it.
To view the Information Technology Act, 2000 click here. (Refer Page 4, 5, 6)
Zeta Optima Gift Card program is designed to reward your employees for their valuable contribution or for other important events such as birthday, marriages, festivals and many more. Let us now examine the Gift Card with respect to it's compliance with Government regulations.
Section 17(2)(viii) of Income tax states:
Section 17(2)(viii) |
Gifts worth up to Rs 50,000 presented to an employee by an employer, will not attract the Goods and Services Tax (GST). |
Zeta Uniform Allowance Card is a comprehensive tax benefit program that your organisation grants to meet the expenditure incurred on the purchase or maintenance of uniform for wear during the performance of office duty or employment of profit. Let us now examine the Uniform Card with respect to it's compliance with government regulations.
Rule 2BB, Section 10(14)(i) of Income tax states:
Uniform Allowance is valid only when employees' outfits are identical and as per the design standard prescribed by the organization. There can be differences in uniform among certain classes of employees on the basis of seniority or nature of work within the same organization.
Unless an organization has an explicit policy related to uniform to be worn by employees, any amount paid for the purpose of buying clothes, even if for office wear, shall be fully taxable.
Rule 2BB, Section 10(14)(i) |
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