Perquisite income tax section 17(2)

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This discussion clarifies the taxability of medical expenses reimbursed by an employer. While medical expenses for parents paid to private hospitals and reimbursed by the employer are generally exempt under Section 10, the employer has shown this amount as a perquisite under Section 17(2) in Form 16. This can lead to the Income Tax Department (CPC) automatically calculating tax on it. It's advised to declare the exempt amount under the 'exempt income' section of ITR-2 to avoid discrepancies and potential queries from the CPC.

vijay

vijay (Querist)

18 July 2024 An Assesse is central government employee he incurred medical expenses for his father in private hospital and reimbursed amount of rs.98651/-from employer.
The employer shown amount in form no.12BA as value of perquisite of Rs.98651/- as other benefits or amenities. Does this perquisite amount is taxable ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

19 July 2024 No. It is exempt.

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vijay

vijay (Querist)

19 July 2024 Thanks for your reply sir
Please can you tell me under which head i have to show exempt amount in ITR 2

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

19 July 2024 sec 17(2) perquisites

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vijay

vijay (Querist)

19 July 2024 The employer shown amount of Rs.98651/- in form16 as value of perquisites in Sec 17(2) & added in Gross salary. Can i show this amount in exempt allowances in u/s.10 column?
While filing up of ITR2, the utility calculate tax on amount of value of perquisites in sec 17(2).

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

19 July 2024 If employer has not declared it separately, it will be difficult to convince ITD. Whenever there is difference in form 16 & ITR, the query is being raised by CPC. You may try it by declaring it under exempt income.

vijay

vijay (Querist)

19 July 2024 The Employer has declared amount separately under value of perquisites 17(2).
Can query will raised by CPC after the filing of income tax return.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

19 July 2024 Yes, if employer has considered it as taxable perquisites, otherwise not,

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