Medical reimbursement of hospitalization
This query is : Resolved
30 August 2025
I am a psu employee. I had undergone surgery in Fortis Hospital in the financial year 2024-25 at CGHS rates. The medical expense was reimbursed by my employer. Is this reimbursement taxable?
30 August 2025
PSU employees receiving reimbursement at CGHS rates for treatment at empaneled hospitals (like Fortis) are not liable to tax on the reimbursed amount, as per prevailing government circulars and income tax rules. Check form 16.
30 August 2025
Kindly provide under which section the reimbursement is not liable to tax?
30 August 2025
Read page 3 reply from ITD...
https://www.aibsnlretd.org/RTI%20Reply%20from%20Income%20Tax.pdf
https://www.aibsnlretd.org/RTI%20Reply%20from%20Income%20Tax.pdf
31 August 2025
Should I apply for refund as my employer has deducted tax at source for reimbursement of my hospitalization expense?
31 August 2025
If the employer has already deducted TDS, ITD will consider it as taxable perquisite. So it will be better option to get it corrected at you employer's base.
31 August 2025
In BSNL it's a practice to deduct TDS on the reimbursement of hospitalization. The employees union have given applications to correct this but they continue to deduct tax as shown in the link shared by you. What alternative do I have?
31 August 2025
The mistake is from employer end, ITD will not rectify.
Union must get it rectified from BSNL desk citing the reply as attached in earlier massage.
Union must get it rectified from BSNL desk citing the reply as attached in earlier massage.
31 August 2025
Kindly click on the view file link on this web page.
https://www.bsnleu.in/medical-reimbursement-should-not-be-treated-as-perquisite-for-income-tax--clarification-issued-by-principal-chief-commissioner-of-income-tax-up-east--bsnleu-writes-to-the-cmd-bsnl-demanding-implementation-of-the-order.
The pdf has a representation from the union along with the letter from the principal chief commissioner.
As mentioned on page 2 in point 2 (ii),
"Further as concerned with refund process of TDS made the applicant is required to file the ITR for the relevant assessment year claiming excess tax deducted within due date on e-filing portal declaring true and correct particular of income and after computing total income the refund amount if any will be generated after the return is processed"
Can I apply for refund on this basis?
https://www.bsnleu.in/medical-reimbursement-should-not-be-treated-as-perquisite-for-income-tax--clarification-issued-by-principal-chief-commissioner-of-income-tax-up-east--bsnleu-writes-to-the-cmd-bsnl-demanding-implementation-of-the-order.
The pdf has a representation from the union along with the letter from the principal chief commissioner.
As mentioned on page 2 in point 2 (ii),
"Further as concerned with refund process of TDS made the applicant is required to file the ITR for the relevant assessment year claiming excess tax deducted within due date on e-filing portal declaring true and correct particular of income and after computing total income the refund amount if any will be generated after the return is processed"
Can I apply for refund on this basis?
31 August 2025
Yes, you can, but will have to follow the query raised by CPC.
01 September 2025
In form 16 this reimbursement is included in my gross salary. In itr utility where can I show this reimbursement as non taxable?
01 September 2025
You may report it as tax free perquisite; but CPC will not accept it and you may get defective notice.
01 September 2025
What all documents I will have to keep record of on getting defective Notice?
01 September 2025
Justification for the tax free claim of the medical reimbursement.
21 September 2025
Good luck....
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