Sir my mother received a fixed amount of aprx Rs.15000 every quarter for medical reimbursement without submitting any bills from the employer after the retirement (Total Rs.60,000 for the financial year). What will be the tax applicable on this reimbursement. Whether we have to add Rs.60000/- in full as as part of salary in income tax return OR can we take any deduction under 17(2) of IT act or any other act. The taxability may please be informed for FY 2022-23 AY 2023-24 or for further financial years. Thanks AMIT ARORA

Ans: Hello Mr. Amit Arora,

I understand that you're seeking guidance regarding the tax implications on your mother's medical reimbursement. The tax treatment for medical reimbursements in India is a bit nuanced.

Typically, under section 17(2) of the Income Tax Act, any amount reimbursed by the employer towards medical expenses incurred on the treatment of the employee or their family members is exempt from tax, subject to a limit of Rs. 15,000 per annum. However, this is applicable only when actual medical bills are submitted.

In your mother's case, as she's receiving the amount without submitting any bills, this will not qualify for tax exemption under section 17(2). Therefore, the entire sum of Rs. 60,000 will be treated as her income from salary and will be subject to tax according to the tax slab she falls under.

I hope this helps.

Best Regards.