Thursday, 22 November 2012

Is Medical Reimbursement Taxable ?

As per section  17(2) of the I T Act , medical reimbursement by an employer is not taxable in hand of an employee as perquisite if  treatment of the employee or his family member is done in any of the following hospitals
  1. Hospital maintained by employer.
  2. Central Govt or state or municipal maintained hospital
  3. Any hospital approved by Govt for its employees
  4. For prescribed diseases or ailments, hospitals  approved by Chief Commissioner of Income Tax .
Thus , if the treatment of govt employee’s son was done in govt hospital or approved hospital, reimbursement of any expense without limit is exempt from tax.
You can get the list of approved hospitals list from Circular No. 603, dated 6-6-1991
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