re-employment of a person of 60 years or taxation purposes
sunil
(Querist) 01 September 2016
This query is : Resolved
Dear Experts, Need your expert advise on the following: 1. Can a person be employed in an organisation as an employee on fixed period of 2-3 years or more on Salary basis where the normal retirement age is 60 years? 2. Is it mandatory to have a time gap in re-employment of a person who retires on a particular date? 3. Whether HRA, CONVEYANCE ALLOWANCE, MEDICAL ALLOWANCE , medical benefits, Leave ( casual, medical/ sick, Earned Leave, benefit of Provident Fund etc. can be given to a person who is so employed or re-employed? 4. Whether contribution to National Pension Scheme can be made by the employer to such employee who is/ was already a member of NPS of that organisation and the organisation has opted for extension of 10 years in his membership of NPS? 4.1 Is there any legal bar under any Indian Laws to give or not to give any of the above or all the above benefits to a person of more than 60 years? 5. Whether the amount paid to such employee be taxed as Salary Income or professional or other contractual income and TDS deducted accordingly? 6. Is it illegal to employ a person of 60 years or more on Salary basis? 6.1 Whether it is must to employ that person on contract basis and pay him fee only? 7. If such person is engaged other than on Salary basis, whether the amount paid to him will attract Service Tax on the amount paid.? 8. Advise generally on the precautions to be taken in employment / re-employment of a person of 60 years or more in the same organisation from where he retired in attaining the age of superannuation (60 years). My email id is : ceo@jghdelhi.net saggarsk@ gmail.com My mobile number: 9810137732. Since, the matter is urgent, your early advise is requested. Thanks and regards fir your advise. Sunil Saggar
Raj Kumar Makkad
(Expert) 01 September 2016
1. No but in exception circumstances after obtaining departmental approval as per policy of Government, such re-employment can be given subject to certain conditions.
2. No.
3. No.
4. Yes
5. Yes
6. No
7. Yes
If the past 5 ACR of such employee are good and he has been superannuated respectfully only then his name should be got considered.
sunil
(Querist) 01 September 2016
Thank you Sir
This is not a case of Govt employee..
This is a case of private hospital.
Please advise if a such person can be re employed on Salary basis and benefits of allowances HRA/ LEAVE/ MEDUCAK ALLOWANCE/ CONVEYANCE ALLOWANCE etc can be given to him and can be taxed as salery income and TDS DEDUCTED ACCIRDINLY .
Sir, I really appreciate your clear advise on the above.
Warm regards
Kumar Doab
(Expert) 01 September 2016
The answer to all queries is: Yes.
The employer/Board/trust/senate etc etc can decide.
Reemployed employee shall get benefits e.g. PF,Gratuity etc
Issue salary slip, Form16....
Rajendra K Goyal
(Expert) 01 September 2016
This seems examination question paper and not a query.
Academic query, state material facts of the problem.
Kumar Doab
(Expert) 01 September 2016
Repeated at:
http://www.lawyersclubindia.com/experts/Employment-of-a-person-of-60-years-or-more-on-salary-basis-614471.asp
http://www.lawyersclubindia.com/experts/Employment-of-a-person-of-60-years-or-more-on-salary-basis-614461.asp
sunil
(Querist) 01 September 2016
Dear Kumar Doab Sir,
Thanks
Whether answer to question No. 6 Is also yes?
Kindly elaborate.
I hope there is no requirement of a gap between previous relationship and the start of re-employment on Salary plus other benefits including leave etc. and payment on Salary basis subject to deductions of TDs applicable on Salary Income.
Please confirm.
Thanks and regards
Kumar Doab
(Expert) 01 September 2016
If repeated 2nd time is called Repeated.
For 3rd time usual term is Triple
then quadriple, then Penta, Hexa .......Octa etc etc...
Kumar Doab
(Expert) 01 September 2016
What is this repetition and why?
Rajendra K Goyal
(Expert) 01 September 2016
repeated query, posted in parts also at.
http://www.lawyersclubindia.com/experts/Employment-of-a-person-of-60-years-or-more-on-salary-basis-614471.asp
http://www.lawyersclubindia.com/experts/Employment-of-a-person-of-60-years-or-more-on-salary-basis-614461.asp
Kumar Doab
(Expert) 01 September 2016
All including but not limited to ...6...have been answered by me and Mr. Makkad.
Your establishment should prefer to engage a very able counsel specializing in Labor/Service matters.
sunil
(Querist) 01 September 2016
Dear Shri Rajender Goyal Sir,
Thanks for your response.
Sir, this is a real situation.
One of GM is retiring next month upon attaining the age of supperannuation I.e. 60 years.
He wants to be re-employed on a tenure appointment of 2-3 years and requested that he be employed on Salary + other benefits basis as stated in the original request.
My HR has submitted that he can't be legally re employed on Salary basis as it is not legal and thus can't be given salary + extended benefits normally available to salaried employees.
My institution concern is that if we pay his compensation as contractual fee, it will not only attract Service Tax but also he will be deprived of eligible deductions exemptions on account of I tax etc. And hence I requested for your expert advise.
Kindly advise and help.
We are a non corporate private hospital and are not a government organisation.
I hope you will kindly oblige by pricing pointwise replies.
Regards.
Sunil Saggar
CEO
Of the hospital
sunil
(Querist) 01 September 2016
Sorry Sir,
There was some net problem, it was not showing the query submitted and hence repetition...
Sorry for inconvenience caused.
Regards
Guest
(Expert) 01 September 2016
Mr. Sunil,
Your HR is correct in its advice.
But from your clarificatory statement, "he will be deprived of eligible deductions exemptions on account of I tax etc.," I wonder to know whether, as a CEO of the organisation, you are required to watch the interest of your organisation or a retiring employee?
Other questions are irrelevant, when you cannot employ the retiring person as a regular like employee with all the benefits extended of a regular employee to him.
You may however, re-employ him on contractual basis on some fixed remuneration by entering in to a suitable agreement with him.
Kumar Doab
(Expert) 01 September 2016
Your establishment should prefer to engage a very able counsel specializing in Labor/Service matters.
You may ask your HR personnel to send the query to a very able counsel specializing in Labor/Service matters.
Your HR personnel is also bound by policies of your establishment.
HR personnel have their own limitations and are not right substitute for a very able counsel specializing in Labor/Service matters.
sunil
(Querist) 01 September 2016
Dear Shri Dhingra,
Thanks for your response.
As a CEO my interest is to right thing creating a win win situation ...That's the reason expert advise was sought through this club.
Please advise that fixed remuneration will be taxed as Salary or contractual income/ professional income?
Thanks once again.
Regards
H.M.Patnaik
(Expert) 01 September 2016
Experts have answered adequately.However, since you are seeking guidance on behalf of an institution, You should go for consultation with an experienced Service matter practitioner of your area.
Besides, if your institution feels retaining a superannuated person for a couple of years will benefit your organisation, you may retain his services as an outside consultant/ Adviser on a consolidated honorarium plus reimbursement of all actual expenses incurred for attending your work.
Guest
(Expert) 01 September 2016
Mr. Sunil,
Here your statement, "Please advise that fixed remuneration will be taxed as Salary or contractual" has clearly revealed that your query is purely an acadmic query, as if the Accountants of your company do not know aanything about taxation. That is quite unbelievable.
Moreover, it is quite surprising to note that instead of the concerned, you are taking undue interest in his affairs.
Still further, it is not understood, how you are so deeply concrnd to ask about taxation problem of your employee, who is yet to be employed by you, while the HR personnel of your organisation have to take care at the time of drawing his salary that too only after you take the retired employee as your consultant.
As a CEO, since you have sufficient supporting staff of HR and Finance & Accounts personnel, the concerned person should be asked to approach them or a tax consultant to get his doubts cleared, if he has any.
Any more question on your commercial query or behalf of the retiree is not justified on your part.
Kumar Doab
(Expert) 01 September 2016
All points from all stances have been illustrated in the thread.
Rest your own counsel can guide you further.
sunil
(Querist) 02 September 2016
Thanks all
Kumar Doab
(Expert) 03 September 2016
You are welcome.
