Service charge not shared with restaurant staff liable to tax: CBDT
The Central Board of Direct Taxes (CBDT) has said that service charge collected by restaurants but not passed on to workers will be liable to income tax. The tax department has instructed officials to verify if there is any 'under-reporting' or 'non-reporting' of income collected as service charge. The CBDT's crackdown comes after the Consumer Affairs Ministry flagged its concerns.