Medical Reimbursement amount regarding heart desease

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sunildatta (Querist)
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01 March 2010 the assessee had suffered from Hypertension & Ischaemic Heart Disease and therefore (Angioplasty) PTCA with Stent to LM done. and the assessee claims for amount of Rs. 134820/- towards expenses incurred tor this medical treatement. and he reimbursed such amount from his employer.
Now whether the total amount of Rs. 134820/- is exempt from tax because such amount is incurred for heart deases.
if it is exepmt, under which section?
please give details urgently.

M Prabhakar Menon

M Prabhakar Menon (Expert)
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03 March 2010 U/s 80DDB if the reimbursement falls short of the actual expenses u may claim upto Rs40,000/- or Rs60,000/-(for senior citizen)as deduction provided certain other conditions are satisfied but since the entire expense is reimbursed u have no claim.

sunildatta

sunildatta (Querist)
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05 March 2010 No sir I want to know that whether Medical Rembarsement u/s. 17(2), and as per Income Tax rule 3A-2(d) is exempt ? please advise me urgently.

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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03 August 2024 Under the Income Tax Act, medical reimbursement and its tax implications can be understood based on specific provisions and rules. Let's break down the details related to your query about the exemption for medical reimbursement for heart disease treatment:

1. Medical Reimbursement Under Section 17(2) and Rule 3A
Section 17(2):

Definition: Section 17(2) of the Income Tax Act includes medical reimbursement as a perquisite in the salary of an employee. The perquisite value is generally included in the taxable income of the employee.
Rule 3A:

Rule 3A(2)(d): This rule, under the Income Tax Rules, specifies the conditions under which medical reimbursement is exempt. According to this rule, medical expenses incurred for treatment of certain diseases are exempt, but there are specific conditions and limits.
2. Exemption for Medical Reimbursement
Medical Reimbursement for Specific Diseases:

Pre-Finance Act, 2018: Under the Income Tax Act, medical reimbursement for treatment of specific diseases, including heart diseases, was generally covered under Section 10(14) of the Income Tax Act. The exemption was up to ₹15,000 per annum.
However, this provision was withdrawn after the Finance Act, 2018, and was replaced by a standard deduction of ₹40,000 (later increased to ₹50,000).
3. Current Situation (Post Finance Act, 2018)
Standard Deduction: From FY 2018-19 onwards, the exemption for medical reimbursement was replaced with a standard deduction of ₹40,000 (later increased to ₹50,000). This standard deduction covers medical reimbursement and other allowances, so separate exemptions under Section 10(14) or specific disease-related reimbursements are no longer applicable.
4. For Medical Reimbursement for FY 2011-12 and Similar Previous Years:
Since your query involves a reimbursement for medical treatment related to heart disease:

Before FY 2018-19: For the financial year 2011-12 (before the changes), medical reimbursement for heart disease was subject to the ₹15,000 exemption under Section 10(14). Since you mentioned the amount of ₹134,820, if it was incurred in the earlier financial year, the excess over ₹15,000 would not be exempt.
5. Tax Implications for Amount Reimbursed:
Exempt Portion: For amounts reimbursed as medical expenses for diseases covered by Section 10(14) before the Finance Act, 2018, only up to ₹15,000 was exempt. Any amount reimbursed above this limit would typically be considered taxable.
Current Rules: Post-Finance Act, 2018, medical reimbursements are included in the standard deduction. Thus, the specific exemption for medical expenses related to diseases like heart disease is no longer applicable.
Summary:
For Financial Years Before FY 2018-19: You could claim exemption for medical reimbursement up to ₹15,000 under Section 10(14) for treatment of diseases like heart disease. The amount exceeding ₹15,000 would not be exempt.
For Financial Years FY 2018-19 Onwards: The exemption under Section 10(14) was replaced with a standard deduction, so medical reimbursements are covered under the standard deduction of ₹40,000 (later ₹50,000) and do not have separate exemptions for specific diseases.
For the most accurate and specific advice, particularly related to past financial years or specific tax scenarios, consulting a tax professional or chartered accountant is recommended. They can provide guidance based on detailed information and current tax laws.