Also if the employee claims medi claim policy reimbursement from the employer for the insurance premium paid does this becomes a part of his gross income & whether tds should be deducted in this amount?
- Medical facility provided in a hospital,clinic ,dispensary or nursing home maintained by the employer.
- Reimbursement of medical expenditure by the employer, incurred by employee on his or treatment of his family member.
- in any govt hospital (including dispensary /clinic or nursing home) or
- hospital (including dispensary /clinic or nursing home) maintained by Local authority or approved for govt employees .
- the expenditure excluded from the perquisite value shall be to the extent permitted by the Reserve Bank of India;and
- the travel expenditure is excluded only if the gross total income of the employee before including such travel expenditure does not exceed Rs. 2 lakhs.
so other than above the medical facility is taxable in hands of employee.Treatment amount ,reimbursement , unapproved /non govt Hospital other than as explained in point no 2 above up to 15000 is not be included in salary and amount in excess of 15000 is to be included in employee's salary.
Now point wise answer to your queries.
whether the medical reimbursement given to an employee against medical bills submitted by them for Rs. 15000/-(maximum limit) is it taxable or does it have any effect on the gross income of an employee. Is there any exemption to this amount.
- As explained above, valuation of reimbursement upto 15000 rs per annum in non approved /non govt hospital is to be taken as nil .so the amount up to 1500o per annum have no effect on gross Income of an employee.Please note that this is under valuation rule and not an exemption.
Whether to take this income of any employee into account while calculating Income Tax while preparing Form 16.?
- The answer is yes,If the amount is taxable in employee's hand then we have to show it in Form 16.In form 16 ,there is sub part of gross salary part 1(b) "value of perquisites under section 17(2)",so under this head we will show amount taxable from the facility of medical treatment.But if value of medical facility is nil as per above details then nothing is to be shown .Form 12BA for valuation of perquisites is also required to be issued ,where there is a value of perquisites has been added in the income of the employee.
- Amount reimbursement for mediclaim policy by employer , is also exempted as given above ,(point no 6) hence not to be included in employee's salary so no TDS is required to be deducted.If any reimbursement which is not covered under above rules then that amount is top be included in employee salary ,tds is also to be deducted and detail are also required to be shown in form 16 and 12BA.
- Treatment form Hospital maintained by employer(appox expenses 100000):Noting is taxable as medical facilty value for Income tax purpose is NIL.
- Treatment in Govt Hospital :Hospital bill 2000 and medicine purchased from private shop against treatment in govt hospital:20000:Full 20000+2000 is not to be included in salary as the treatment in govt hospital.
- Treatment in pvt Hospital amount Rs 25000: In this case 15000 is exempted and 10000 is taxable.