Medical reimbursement procedure

This query is : Resolved

Tapas Debnath (Querist)
Follow

23 October 2009 Someone getting Basic Rs.17670, HRA Rs. 9009, T.A. Rs. 5199 and Other Rs.2772. Total Rs. 34650.per month.

Out of Rs. 2772 x 12 = Rs.33264 if I show Rs. 15000 (maximum) as medical reimbursement within a year will it be allowable?

Guest

Guest (Expert)

23 October 2009 I think there should not be any problems, if this is flexible salary and company has given an option to take 15000 INR as medical reimbursement.

Guest

Guest (Expert)

23 October 2009 Its totally depend on the company policy.

Upgrade to CAclubindia Pro. Subscribe Now!

CA SANJAY MUKHERJEE

CA SANJAY MUKHERJEE (Expert)
Follow

23 October 2009 You have to deduct Rs. 1250 per month fron any head e.g other & to reimburse seperately.

If you show other salary of Rs.2772 in monthly salary slip and then it would be taxable.

CA SANJAY MUKHERJEE

CA SANJAY MUKHERJEE (Expert)
Follow

23 October 2009 Medical reimbursement is not taxable upto Rs. 15000 but it's not same as deduction for Conveyance allowance or HRA or LTA. In those cases you pay fixed allowance per month and then at the time of computation of tax deduction is computed as per Sec 10 , e.g. for Conveyance Rs. 800 p.m. is deductible.

But medical expenses reimbursement is different; it's a perquisite and above 15,000 is taxable. Till last year company had to pay FBT on that. So please keep this out of salary structure and make reimbursement against bills like we reimburse telephone bills.

The person receiving this can add the salary as per payslip/form 16 and add 15000 to cross check his CTC.