01 February 2018
Friends, As of now, a salaried person is availing free transport allowance of Rs 1600 pm and Medical Allowance/reimbursement of Rs 15000 per annum and Total both Rs 34,200
Now this budget has introduced a standard deduction of Rs 40000 . I want to know whether this Stanadrd deduction is over and above transportation allowance and medical allowance or including both these deductions.Can anyone throw some light on this.
01 February 2018
Those shall be allowed only to differently abled persons
Extracts from Budget Speech. I propose to allow a standard deduction of `40,000/- in lieu of the present exemption in respect of transport allowance and reimbursement of miscellaneous medical expenses. However, the transport allowance at enhanced rate shall continue to be available to differentlyabled persons. Also other medical reimbursement benefits in case of hospitalization etc., for all employees shall continue.
Extracts from memorandum Section 16, inter-alia, provides for certain deduction in computing income chargeable under the head “Salaries”. it is proposed to allow a standard deduction upto Rs 40,000/- or the amount of salary received, whichever is less. Consequently the present exemption in respect of Transport Allowance (except in case of differently abled persons) and reimbursement of medical expenses is proposed to be withdrawn. These amendments will take effect from 1st April, 2019 and will, accordingly, apply in relation to the assessment year 2019-20 and subsequent assessment years.
01 February 2018
If I under stood correctly: W.e.f 1st April, 2018 a differently able person will continue to get the deduction of existing transportation and medical allowance and over and above that he will also be entitled to standard deduction of Rs 40,000.
But a person other than a differently abled person will get overall standard deduction of Rs 40,000 and the existing medical and transportation deduction shall be discontinued.
01 February 2018
Yes. This way problem of fake bills will also be reduced and it will reduce compliance burden by both the employer and employee. A good move.
CAclubindia
