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Medical insurance by employer for staff


CA Ramsai N (Fresher)     09 April 2013

CA Ramsai N
Fresher 
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Hai..

the employer has taken a Medical Insurance cover for the staff.

Please suggest the tax effects on employee and employer.

Is employee eligible to show this under 80D? please refer the sections.

 

 

Thanks in advance

nani (student)     09 April 2013

nani
student 
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test comment post in fourm

avater

CA BHUMIT SHAH (Consultant )     09 April 2013

CA BHUMIT SHAH
Consultant  
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Employer will get deduction of mediclaim premium paid if it is not  paid in cash and employee will not get deduction since he himself has not borne the premium and it may amount to double deduction from the view of revenue department 


(Guest)

 

 
As far as deduction under any other section, employee can not take deduction on the insurance premium paid by the employer. U/S 80C, for claiming the deduction of insurance premium, there is a pre condition that, it should be paid by the person who is taking the deduction.
 
But if the employer is recovering the same from the employee salary then yes the picture is somehow different, then it can be deemed as indirect payment by the employee and employee can take the deduction of such premium.

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CA BHUMIT SHAH (Consultant )     09 April 2013

CA BHUMIT SHAH
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yaa but employer can take deduction u/s 37(1) if it is paid in any mode other then cash


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