Understanding Tax Exemption for Medical Allowance and Reimbursement in IT Returns

Hi,

As we all know, medical allowance is exempted in the hands of the employee to the extent of Rs. 15,000/- only if it is paid as reimbursement and not as a fixed medical allowance.

Now, I would like to know, when the employee is receiving a fixed amount towards medical allowance, and the employer is taxing the same, but the employee has actually incurred medical expenditure and has bills to the extent of the said exempted amount, can he/she claim the same as a refund in his IT returns.

Thank you,
Archana

Medical reimbursement up to Rs. 15,000 is not taxable. When bills are submitted for the same amount, they can be refunded if the employer has deducted or not paid.

I recommend reviewing the November HRM & LLR journal for details on how to minimize taxable remuneration.