Medical reimbursment ?

This query is : Resolved

uday singh Negi (Querist)
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21 February 2013 Dear Sir,

suppose a person getting monthly salary of rs. 50,000/-
and his break up is given below

basic 20,000/-
HRA 15,000/-
conveyance 10,000/-
Medical reimb. 5,000/-

medical allowance is fully taxable but as far as medical reimb. is concerned it is exempted up to 15000/-

so my query is this, if he provides medical bill up to rs. 15,000/- as reimbursement, can he get deduction of rs. 15,000/-

because reimbursement is fixed in a nature per month i think it is taxable ?

but some people says it is non taxable and he can get deduction of rs. 15000/-

but i think reimbursement is apart from salary and it can not be included in salary ,and it is non taxable if employee provide bills for getting these deduction and these reimbursement is sepretaly shown as medical exp in the books of company not as part of salary or salary ?

it can be a cost of personnel

Expert Plese reply

Nikhil Kaushik

Nikhil Kaushik (Expert)
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24 February 2013 reimbursement for medical expenses is exempt upto Rs 15,000 p.a.

companies divide the medical reimbursement portion over the months just to keep monthly cash flow steady and tax computation simple.

on production of medical bills, your tax computation is accordingly adjusted.

So it doesnt matter if u are receiving medical reimbursement as a part of your salary.

as long as you have submitted bills for Rs 15,000, that amount remains exempt.

uday singh Negi

uday singh Negi (Querist)
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25 February 2013 nikhil sir,

but how will you show this exempted amount in form 16

because medical reimbursment cover under 17(2) as non taxable perquisite

and i think it will cover under form 12ba as non taxable perqusite

please suggest

uday singh Negi

uday singh Negi (Querist)
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26 February 2013 please reply

Nikhil Kaushik

Nikhil Kaushik (Expert)
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26 February 2013 Dear Uday,

You are right that its is a non-taxable perquisite.

In for 12BA only the taxable perquisite shall be shown. Accordingly, non - taxable perquisite is either not shown or shown at Nil value.

uday singh Negi

uday singh Negi (Querist)
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26 February 2013 because in form 16 only taxable perquisite can be shown , so many people have their view that exemption of rs. 15000/- is allowed

but in income tax it is not covered under any section for deduction

thanks

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