https://www.taxtmi.com/article/detailed?id=6041 The article contends that short notice recoveries may be taxable because they can qualify as a declared service of "agreeing to tolerate an act or a situation" when an employer receives consideration for early termination; alternatively, taxation may not apply if no "activity" is performed. Practically, Section 68(1) makes the employer liable, allowing collection from the employee if a contract states tax is payable extra, otherwise the employer must remit tax on an inclusive valuation basis. The author recommends treating such recoveries as potentially taxable and adopting a precautionary compliance approach. en-us Wed, 04 Feb 2015 06:08:19 +0530 Wed, 04 Feb 2015 06:08:19 +0530 TaxTMI RSS Generator https://www.taxtmi.com/article/detailed?id=6041 The article contends that short notice recoveries may be taxable because they can qualify as a declared service of "agreeing to tolerate an act or a situation" when an employer receives consideration for early termination; alternatively, taxation may not apply if no "activity" is performed. Practically, Section 68(1) makes the employer liable, allowing collection from the employee if a contract states tax is payable extra, otherwise the employer must remit tax on an inclusive valuation basis. The author recommends treating such recoveries as potentially taxable and adopting a precautionary compliance approach. Articles Service Tax Wed, 04 Feb 2015 06:08:19 +0530 https://www.taxtmi.com/article/detailed?id=6041