Amortisation of expenditure incurred under Voluntary Retirement scheme - Section 35DDA - Income Tax - Ready Reckoner - Income Tax

Amortisation of expenditure incurred under Voluntary Retirement scheme - Section 35DDA Where an assessee Incurs any expenditure by way of payment of any sum to an employee in connection with his voluntary retirement, 1/5 th of the amount so paid shall be allowed as deduction for 5 years. The deduction shall be allowed from the previous year in which actual payment is made. The deduction shall be allowed even if the amount paid to employee after voluntary retirement. Where the assessee, being an Indian company, is entitled to the deduction under this is transferred (whether by way of amalgamation, demerger or reorganisation of the business), the provisions of this section shall, as far as may be, apply to the resulting company (newly formed company) as they would have applied to the resulting company if the transfer had not taken place. However, no deduction shall be allowed in respect of the expenditure, for the previous year in which amalgamation, demerger or succession, as the case may be, takes place. However, the payment is made in installments each such payment shall be independently admissible for amortisation over a period of 5 years.