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query on Medical Allowance

Valli (Student -CWA) (157 Points)

17 September 2010

Hi!

Suppose the employer is paying Rs. 500/- p.m as a Medical allowance to employee. Pls let me know for this Medical allowance amount will be consider for exemption from taxable income only if the employee provides the medical bills .

Thanks in Advance.

Regards,

Valli

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8 Replies

(Guest)

NO , THE FIXED MEDICAL ALLOWANCE IS ALWAYS TAXABLE.

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harish .k (STUDING) (306 Points)
Replied 17 September 2010

Ya if the Medical allowance is paid in the part of salary every month is taxable in the hands of employee , because the above medical allowance is not paid in lumpsum i,e is on providing of bills , All fixed alloawance are taxble

1 Like

Valli (Student -CWA) (157 Points)
Replied 22 September 2010

Thank you

Krishna (SSE) (21 Points)
Replied 22 September 2010

Hi,

I have two questions :

1. If my father is a senior citizen, can I avail more exemption on medical insurance?

2. What is meant cashless transaction?

Thanks in Advance.

Renu (Article) (Accountant) (77 Points)
Replied 23 September 2010

Medical Allowance received is taxable, bills paid are not deuctible

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Manoj BG (Tax Professional and in Service) (1795 Points)
Replied 23 September 2010

HI VALLI,

MEDICAL ALLOWANCE IS ALWAYS TAXABLE. BUT REIMBURSEMENT OF MEDICAL EXPENDITURE UPTO RS.15000 IS EXEMPT. THUS, IF CO. IS GIVING FIXED MONTHLY ALLOWANCES THEN IT WOULD ALWAYS BE TAXABLE AND NO EXEMPTION COULD BE CLAIMED THEREFROM.

REGARDS,

MANOJ

Dinesh Kumar Agarwal (Article clerk) (117 Points)
Replied 23 September 2010

Medical Allowance is taxable but by virtue of section 17 (2) medical reimbursement to employee upto Rs. 15000/- p.a. is expempted in the hand of employee. This is treated as Exemted Perquisites.