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Cash Received as Reimbursement Expenses for House Rent and conveyance

Subodh (Finance) (22 Points)

23 June 2019

Can we consider these House Rent and Conveyance reimbursement expenses received by cash as Income.

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3 Replies

Gitesh Khona (student) (290 Points)
Replied 23 June 2019

Yes, for Employees under Salary head.

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Suresh Thiyagarajan (Student) (3986 Points)
Replied 24 June 2019

1. Any type of allowances will by default be considered as income which also includes HRA. However, if you are paying rent in a place where you are staying, the exemption can be claimed sec 10(13A).
2. According to sec 10(14), transport allowance if paid as a part of salary will form part of salary income and exemption to the extent of Rs. 1,600 per month or Rs. 19,200 per year will be allowed.
3. However, there will not be tax in case of conveyance reimbursement which is basically a company's expenses but you have incurred it from your pocket and subsequently, it was reimbursed by the company. Hence it should not form part of your salary income.
Please correct me if the above solution has an alternative view.

CA Navya Tejas (Chartered Accountant) (132 Points)
Replied 24 June 2019

House Rent Reimbursement and conveyance reimbursement will be treated as a part of your Income under your head Income from Salary.

Part A- House Rent Reimbursement can be treated as allowance u/s 10(13A) assuming you are staying in the house for which rent is being paid and exemption can be claimed based on the limits as per sec 10(13A)

Part B- Assuming that reimbursement for travel is provided to you on your commute between work place and house, it can be claimed as an exemption u/s 10(14),19200 rupees per annum can be claimed as an expenditure.