What is Section 17 2 of Income Tax Act?

What is Section 17 2 of Income Tax Act?

“Perquisite” may be defined as any casual emolument or benefit attached to an office or position in addition to salary or wages. “Perquisite” is defined in the section 17(2) of the Income tax Act as including: (i) Value of rent-free/accommodation provided by the employer.

Is reimbursement for medical care reported as taxable income?

To summarize, formal medical reimbursement plans are: Free of payroll taxes (FICA), like premiums paid for group health insurance premiums. Reimbursements are not taxable income, and not included on the employee’s W2.

Is medical reimbursement from employer taxable?

Medical allowance is a fixed component that you receive every month as part of your monthly salary, that is taxable as salary income. Whereas Medical reimbursement is a tax-free component and as discussed above, it is exempted up to the amount spent by employee or Rs. 15,000 whichever is less.

What are perquisites under Section 17 2?

Broadly, “perquisite” is defined in the section 17(2) of the Income-tax Act as including: 1) Value of rent-free or concessional rent accommodation provided by the employer. 2) Value of any benefit/amenity granted free or at concessional rate to specified employees etc.

What are exemptions section 17?

Perquisites – Medical Treatment/ Expenditure (Exemptions) – Section 17(2) – Salary Income – Income Tax. 1. The perquisite in respect of medical facility provided by an employer in following hospitals/clinic is not chargeable to tax: Hospital owned and maintained by the employer.

How can I get Form 12BA online?

For Form 12BA, you can download it from the official website of the Income Tax Department of India – incometaxindia.gov.in. It is available in a pdf format which has to be printed, duly filled with all the details and then submitted to your current employer.

Is reimbursement considered income?

Business expense reimbursements are not considered wages, and therefore are not taxable income (if your employer uses an accountable plan). An accountable plan is a plan that follows the Internal Revenue Service regulations for reimbursing workers for business expenses in which reimbursement is not counted as income.

How do I report reimbursed medical expenses?

If you got a 2020 reimbursement for medical expenses you paid in 2019 or a prior year, include the reimbursement or the amount of the medical deduction you got in the prior year (whichever is less) on your 2020 taxes. Example: Last year, Jo had unusually large medical bills and could take the itemized deduction.

Under which section medical reimbursement is exempt?

The premium paid towards the mediclaim policy is not regarded as a medical expenditure, but Section 80D benefit is available. It will not be considered for income tax exemption under medical reimbursement but can be considered for tax deduction separately under Section 80D of the Income Tax Act.

Is medical reimbursement a perquisite?

Any reimbursement by the employer of any insurance premium paid by the employee, for an insurance for his health or the health of any member of his family under a scheme approved by the General Insurance Corporation of India for the purpose of Section 80D is also a tax-free perquisite.

What is the meaning of salary as per section 17 1?

According to Section 17(1) salary includes the following amounts received by an employee from his employer, during the previous year : Wages; the contribution made by the Central Government or any other employer in the previous year, to the account of an employee under a pension scheme referred to in Section 8OCCD.

Why form 12BA is required?

The main purpose of the form is to furnish details of the income earned by the individual from the previous organisation. Every new employee has to submit Form 12B to their new employer. Form 12BA is a detailed statement showing particulars of perquisites, other fringe benefits and profits in lieu of salary.

Which is exemption under Section 17 ( 2 ) of IT Act?

Income Tax Medical Bills Exemption under Section 17 (2) One such exemption is medical allowance. It is an allowance that is provided for under section 17(2) of the IT Act and states that an employee can submit bills to the employers for medical treatment undertaken by them of their family members. Once the bills are submitted,…

Is there separate column for medical reimbursement 2017-18?

In A.Y. 2017-18, there is no separate column to disclose exempt amount. You should declare total GTI after deducting medical reimbursement figure and then deduct professional tax figure, after which there will not be any difference between Form 16 and your ITR.

Which is considered tax free for medical reimbursement?

Apart from medical reimbursement worth Rs.15,000 being tax-free, the following prerequisites are considered tax-free under Section 17 (2): Bills incurred for medical treatment of employee or family members of the employee in a hospitals maintained by the employer.

Is the medical allowance of an employee taxable?

The medical allowance is just an amount that is defined by the government. The purpose of this amount is to provide employees with tax benefits in case they have had to spend on medical procedures in the year. It can be claimed for treatment undertaken by an employee or their families. Medical allowance is taxable.