We Design Your Financial Destiny


(Precious) Words of Wisdom : "Never spend your money before you have earned it." ~ Thomas Jefferson

Medical expenses reimbursed are tax free if...

Many employers provide reimbursement to their employees, as part of the salary package, for the medical expenses incurred by them on themselves or their family members. 

This amount is entitled to some tax exemptions.

Some of the key provisions in this regard, as per the Income Tax Act, are detailed below.

- The limit to such an exemption is Rs.15,000 per annum. (Note: There is no limit to the amount that your employer may give you as medical reimbursement. But any amount more than Rs.15,000 p.a. would be taxable even if actually incurred.)

- The expenses should be incurred on medical needs of your family which includes your spouse, children and dependent parents / siblings.

- There is no stipulation of any approved hospital or mode of treatment. In other words, expenses on naturopathy, ayurveda, etc. are also covered.

- The key word here is ‘reimbursement’ i.e. only the actual expenses, given against the supporting bills/documents, will be allowed as deduction. If you are receiving any ‘Medical Allowance’, no deduction will be allowed.

In addition to the foregoing, 'full amount' is tax free in the following instances:
- the value of any medical treatment provided to an employee / family members in any hospital maintained by the employer;
- sum paid by the employer in respect of any expenditure actually incurred by the employee on his/family's medical treatment in any Govt. / Govt-approved hospital

As regards medical treatment abroad 
- the actual expenditure on stay and treatment abroad of the employee / family member, including one attendant, is excluded from perquisites to the extent permitted by RBI 
- And if the employee's gross total income does not exceed Rs.2 lakhs, even the expenditure incurred on travel abroad by the patient / attendant is excluded from the perquisites.

An Investment In Knowledge Pays The Best Interest ~ Benjamin Franklin

101 Classic Tips Money Gyaan

You Learn A Lot By READING... And Even More By SHARING.

Share Button

Ignorance is like a SIGNED BLANK CHEQUE... anyone can MISUSE it.

Subscribe via Email
Powered by Blogger.

... Three VALUABLE Tips ...

1. Which Is The Best Day To Invest Your Money?
Best Day for Investment
My "unique" take on the auspicious days to make the best investments.

 


2. Housewives Too Can Become Millionaires
Millionaire housewives with compounding
Saving for MORE TIME gives much better results than saving MORE MONEY.

 


3. Twist In Credit Card Interest Calculations You Must Know
Credit Card Interest Calculation
Calculating Finance Charge on your Credit Card is LOT SIMPLER than this.