Following are fully exempt
- Medical Insurance Premium of Employee paid by the company to Insurance Co. (Approved by IRDA)
- Medical Insurance Premium paid by Employee or his family member and then claimed from the company
- Free Medical treatment of Employee or his family member within India
(a)In hospital of Employer
(b)For Prescribed Diseases (Mentioned in Rule 3A) and certificate received by hospital
is fully exempt.
In other cases, maximum 15000 p.a. exempt as Medical Reimbursement
4. Medical Reimbursement
Medical Bills Reimbursement from Employer up to Rs 15000 per annum is exempt. Doctor / Chemist / Hospital bill is covered here.Even medical bills of family members covered.
SUMMARY
QUESTION
Q1
Basic salary – Rs.20000/− p.m.
Annual medical (reimbursement claimed – 25000)
Calculate income from salary ?
View answer
Medical Bills reimbursement is exempt upto 15000 p.a.
| PARTICULARS | Amt Recd | Exempt | Taxable |
| Basic Salary | 240000 | 240000 | |
| Medical Reimbursement | 25000 | 15000 | 10000 |
| INCOME FROM SALARIES | 250000 |
Q2
Basic salary 20000
Annual medical reimbursement claimed – 25,000
Medical insurance done Rs.10000 by the Employee and claimed from company
View answer
Medical insurance claimed is exempt without limit
(it is not included in 15000 limit )so answer same as last
| PARTICULARS | Amt Recd | Exempt | Taxable |
| Basic Salary | 240000 | 240000 | |
| Medical Reimbursement | 25000 | 15000 | 10000 |
| Medical Insurance | 10000 | 10000 | 0 |
| INCOME FROM SALARIES | 250000 |
Q3
Basic salary = 20000 per month
Employee become ill and was admitted hospital .
Hospital expenses of Rs.50000 reimbursed by company
In addition the Employee also claimed medical bill reimbursement by company of Rs.25000
Calculate Income from salary .
View answer
If treatment is for prescribed diseases or in approved hospital
and
Certificate received from hospital
then Rs.50000 reimbursed is exempt
| PARTICULARS | Amt Recd | Exempt | Taxable |
| Basic Salary | 240000 | 240000 | |
| Medical Reimbursement | 75000 | 65000 | 10000 |
| INCOME FROM SALARIES | 250000 | ||
If the above condition is not fulfilled than it is exempt up to Rs.15000
( Rs.15000 limit is for both medical reimbursement and medical treatment combined) as shown below
| PARTICULARS | Amt Recd | Exempt | Taxable |
| Basic Salary | 240000 | 240000 | |
| Medical Reimbursement | 75000 | 15000 | 60000 |
| INCOME FROM SALARIES | 300000 |
--endanswer--