Salary structuring

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Querist : Anonymous

Querist : Anonymous (Querist)

04 December 2012 Dear Experts, Pls Let me Know, whether Medical Reimbursement i.e. annual payment to employee can be paid monthly, I mean to say suppose 15000 per annum medical reimbursement is payable That is Included in CTC, Now 1250/- per Month Can Employer Pay to Employee, After That Whatever be the Medical bill employee Present at year end, That he can claim in tax deduction while generating form 16.

@VaibhavJ

@VaibhavJ (Expert)
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04 December 2012 Hi,

There is annual limit of Rs. 15000/- you can pay on accrual basis pr-rata to emplyee per month.

If you pay month on month basis & going to collect proofs at the year end only problem will be when emplyee is absconding & fails to submit bills & resignes company will be in default for not deducting TDS & expenses will be disallowed.

Thanks//Vaibhav
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Querist : Anonymous

Querist : Anonymous (Querist)

04 December 2012 Thats Ok, If Employee Fails to Present Bills at Year End, Then TDS Will be Deducted at Year End, Thats OK.

Question is Can Employer Pay, Since Its a Annual Pay not Monthly,
Till Now I Got Reply from Experts That Employer Cant pay.

@VaibhavJ

@VaibhavJ (Expert)
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04 December 2012 Hi,

You can collect bills on monthly basis/ Quarterly basis & pay on mothly basis.

There is no bar on monthly payment. But you should have declaration from employee via email that he will submit bills mothly or quarteerly basis.

Thanks//Vaibhav

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