Q: Kindly advise if Tool Allowance payment should be considered and calculated when ADP and RDP apply.
A: In general, a tool allowance is a reimbursing allowance (not taxable) as it is paid to an employee using their tools in the workplace. It compensates the employee for the wear and tear of their tools.
BUT check the employment agreement, as it may have been agreed to be paid as a taxable allowance.