Hi All,
Please let me know procedure of medical & LTA tax deductions on salary.
For Ex: Our employee's having the gross salary with medical ( apx: 1250/-) & LTA ( Apx: 3333/-). We have deducted both the component and said to employees to submit the respective bills and we will reimburse the same without tax. Is this procedure right or wrong? Pl let me know.
And also let me know how much tax need to be deducted on medical & LTA annually, when the employees are unable to submit the bills for the financial year.
Please give the clarification on the same.
Regards,
Ashwini
From India, Bangalore
Please let me know procedure of medical & LTA tax deductions on salary.
For Ex: Our employee's having the gross salary with medical ( apx: 1250/-) & LTA ( Apx: 3333/-). We have deducted both the component and said to employees to submit the respective bills and we will reimburse the same without tax. Is this procedure right or wrong? Pl let me know.
And also let me know how much tax need to be deducted on medical & LTA annually, when the employees are unable to submit the bills for the financial year.
Please give the clarification on the same.
Regards,
Ashwini
From India, Bangalore
1. Yes, the procedure you have followed is okay.
Some companies follow this method of deducting the medical and LTA and only pay it to employee at the end of quarter/year or whenever they submit the bills.
Some others pay the amount the amount monthly even though employee has not submitted the bill (they consider the amount as TAXABLE in this case). But adjust the tax amount as and when the bills the submitted from total income.
2. If bills are submitted:
Medical and LTA should be deducted from total income (to the extent bills have been submitted) and then the income tax should be calculated.
3. If bills are NOT submitted:
Medical and LTA should be added to total income and then the income tax should be calculated.
From India, Delhi
6Some companies follow this method of deducting the medical and LTA and only pay it to employee at the end of quarter/year or whenever they submit the bills.
Some others pay the amount the amount monthly even though employee has not submitted the bill (they consider the amount as TAXABLE in this case). But adjust the tax amount as and when the bills the submitted from total income.
2. If bills are submitted:
Medical and LTA should be deducted from total income (to the extent bills have been submitted) and then the income tax should be calculated.
3. If bills are NOT submitted:
Medical and LTA should be added to total income and then the income tax should be calculated.
From India, Delhi
Dear Sir,
If the company given salary structure (Basic+HRA+conveyance & Balance amount in Spl/Flexible Allowance), will employee can give breakup on Spl/Flex allowance?
Eg: Basic 10000 + HRA 4000 + Conveyance 800 + Spl/Flexi Aloww 20000 (Will employee can taken the tax benefit by giving Medical bills for Rs15000/pa)?
If the employee submited fake medical bills, is employee or employer responsible?
Please suggest...
Regards
Bala
From India, Bangalore
If the company given salary structure (Basic+HRA+conveyance & Balance amount in Spl/Flexible Allowance), will employee can give breakup on Spl/Flex allowance?
Eg: Basic 10000 + HRA 4000 + Conveyance 800 + Spl/Flexi Aloww 20000 (Will employee can taken the tax benefit by giving Medical bills for Rs15000/pa)?
If the employee submited fake medical bills, is employee or employer responsible?
Please suggest...
Regards
Bala
From India, Bangalore
Yes, employee can break FLEXIBLE allowance into medical reimbursement of 15k only if the employer allows it. It is a good practice to allow employees this option as it helps them save tax.
Employee is responsible for fake bills. But, the employer should also do a bit of bill checking to see if the bill is for medical purchases only. Cosmetics are not allowed and may be questioned by IT department in Audit of your accounts.
From India, Delhi
Employee is responsible for fake bills. But, the employer should also do a bit of bill checking to see if the bill is for medical purchases only. Cosmetics are not allowed and may be questioned by IT department in Audit of your accounts.
From India, Delhi
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