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Fringe Benefits
Fringe Benefits
Fringe benefits are those benefits, which are provided to the employee in addition to the
normal compensation. For Example: when a company provides its employee to use vehicle to
commute from and to work. They are called fringe because many years ago because they were
insignificant part of the pay. However, now the situation has changed as it has become an important
part of the employee package. They include retirement benefits, sick leave, vacation,
reimbursement, social security, day care. Generally speaking, fringe benefits are not taxable for
employees but are for employers. In Australia and New Zealand, the fringe benefits are subject to
Fringe Benefits tax, where as in India it was abolished few years ago.
Fringe benefits are different in different countries. In New Zealand, common fringe benefits include:
Low interest loans, Free or discounted goods and services, subsidised transport, contribution to
sick or accident benefits. In India, certain laws make fringe benefits compulsory on the part of the
employer such as the Factories Act 1948 Sec (51) specifies that no adult should work in a factory for
more than 48 hours in a week. An adult worker shall have weekly paid holidays, preferably Sunday. In
the same way, it also specifies that workers who work during holidays should be offered double the
normal rate of salary. The Employee State Insurance Act 1948 deals about the health benefits.
Insured employees are entitled to get cash benefits for a maximum of 56 days in a year. Employee
Benefits in Canada include transportation benefits, long term insurance plan, discounted shopping,
hotels, resorts etc.
Retirement Benefits
Canteen
Child care benefits
Life Insurance Coverage
Relocation Charges
Transportation Charges
Educational Assistance
Employee Stock Options
Discounts on the goods or services the employer sells
Housing
Profit sharing