Omission of a Meal Allowance - Personal Income Tax Treatment

Due to job, employees always cannot diet at the workplace or return back stably.  So can the company reimburse its staff for a certain amount for meal allowances .

Meal allowance is an enterprise that, in accordance with the provisions of the financial sector, an individual because of the public in urban, suburban for job, but cannot eat at the work place or return back for eat, but need to eat outside, according to the actual number of meal allowance, the standard has no meal or mistakenly to be paid monthly for meal allowance to employees as subsidies.   The problem is meal allowance should be involved in every business, mistakenly made it will accounting for and involved tax treatment, there should be a clear difference.  If not distinguish the difference between them clearly, it is possible to make the wrong accounting treatment and should bear tax risks.

"Ministry of Finance, State Administration of Taxation on Meal Subsidy and Determination the Issue, Notice" ( Cai Shui Zi [ 1995 ] No. 82 ) it provides that it do not levy personal income tax for meal subsidy.   It means that, in accordance with the provisions of the financial sector, individuals, because of in the public or city, suburban for work, cannot work or return to eat, then need to eat outside, according to the actual number of meal and frequence as standard, to receive meals allowence.

In other words, according to the financial sector of the enterprise that required standards is according to the number of days that employees or misuse actual travel for a meal that has mistakenly issued to persons as traveling meal allowance, it does not belong to wages, salaries and is in allowances in nature, it does not levy personal income tax, but for some companies, within the financial sector, with the required standard that distributed to employees and taken the form  in name of wrong meal subsidies or subsidies distributed to employees, allowances, it shall be incorporated into the monthly wage and salary income and that is taxable under personal income tax items.

Therefore, companies use the "meal subsidy,", the name given to workers that allowence do not belong to personal income tax are exempted from the provision of meal subsidy.  It should be incorporated into the calculation of wages for paying personal income tax.