Hi All,
I am a fresher, and I have recently landed a job in an MNC. Since I am new to the corporate world, I am having trouble understanding my salary structure. In my pay structure, the HR has included Medical Reimbursement of Rs. 15,000 per annum in my Fixed Base Pay. Additionally, under Benefits/Earnings in Kind, they have included Medical Insurance of Rs. 13,829 per annum.
I have a few questions:
1. What is the difference between the two?
2. Will I receive these amounts in hand or not?
3. Are they taxable?
I am eagerly awaiting a quick reply.
Thanks
From India, Jammu
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1I am a fresher, and I have recently landed a job in an MNC. Since I am new to the corporate world, I am having trouble understanding my salary structure. In my pay structure, the HR has included Medical Reimbursement of Rs. 15,000 per annum in my Fixed Base Pay. Additionally, under Benefits/Earnings in Kind, they have included Medical Insurance of Rs. 13,829 per annum.
I have a few questions:
1. What is the difference between the two?
2. Will I receive these amounts in hand or not?
3. Are they taxable?
I am eagerly awaiting a quick reply.
Thanks
From India, Jammu
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Hi Ambitiousgrad,
Generally, companies will have a tie-up with a medical insurance group. There will be a premium amount per annum based on the group (self/self + spouse + kids/self + spouse + kids + parents). Your company has claimed insurance for you and included the amount in your CTC. The amount has been paid on your behalf, and you can avail a sum of rupees for your medical treatments for injuries, accidents, etc., which is tax-exempt. Now, clarify the following questions with your HR department. Listed hospitals will be available for your insurance. If you receive treatment at unlisted hospitals, you can submit the bills for reimbursement of the amount you spent.
1. What is the sum insured amount?
2. What are the insurance group details?
3. Who is liable under this medical insurance?
4. Can I get a list of hospitals covered?
5. What are the claiming/reimbursement procedure details?
Please let me know if you need further assistance.
Best regards,
[Your Name]
From India, Hyderabad
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Generally, companies will have a tie-up with a medical insurance group. There will be a premium amount per annum based on the group (self/self + spouse + kids/self + spouse + kids + parents). Your company has claimed insurance for you and included the amount in your CTC. The amount has been paid on your behalf, and you can avail a sum of rupees for your medical treatments for injuries, accidents, etc., which is tax-exempt. Now, clarify the following questions with your HR department. Listed hospitals will be available for your insurance. If you receive treatment at unlisted hospitals, you can submit the bills for reimbursement of the amount you spent.
1. What is the sum insured amount?
2. What are the insurance group details?
3. Who is liable under this medical insurance?
4. Can I get a list of hospitals covered?
5. What are the claiming/reimbursement procedure details?
Please let me know if you need further assistance.
Best regards,
[Your Name]
From India, Hyderabad
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Hi,
Actually, medical reimbursement is a component of salary, basically to save tax, the company will do so. Because 15K is the maximum limit as per income tax. You will produce a bill for that to the company; without a bill, you cannot receive that money from the company. In the absence of medical bills, you will receive 15K after deduction of tax.
Mediclaim insurance is like insurance for you and your dependents (if you add them). The premium of Rs. 13,829/- that you are paying will add to your CTC, and no benefit you will get. It is like a facility that the company is giving to you. To save tax, the company will do so.
From India, Ghaziabad
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Actually, medical reimbursement is a component of salary, basically to save tax, the company will do so. Because 15K is the maximum limit as per income tax. You will produce a bill for that to the company; without a bill, you cannot receive that money from the company. In the absence of medical bills, you will receive 15K after deduction of tax.
Mediclaim insurance is like insurance for you and your dependents (if you add them). The premium of Rs. 13,829/- that you are paying will add to your CTC, and no benefit you will get. It is like a facility that the company is giving to you. To save tax, the company will do so.
From India, Ghaziabad
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Dear Member,
Medical Reimbursement: It is an amount payable to you either as a monthly amount, a lump sum payment, or against the production of medical expenses bills. The amount is taxable unless you produce the bills of expenses.
Medical Insurance: It is like any other mediclaim insurance policy and is governed by the policies of the insurers. As rightly pointed out by Ratnakaram, you will have to talk to your HR and get the details of the policy. The amount is not paid to you and is not taxable.
Regards,
Preetam Deshpande
From India, Mumbai
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Medical Reimbursement: It is an amount payable to you either as a monthly amount, a lump sum payment, or against the production of medical expenses bills. The amount is taxable unless you produce the bills of expenses.
Medical Insurance: It is like any other mediclaim insurance policy and is governed by the policies of the insurers. As rightly pointed out by Ratnakaram, you will have to talk to your HR and get the details of the policy. The amount is not paid to you and is not taxable.
Regards,
Preetam Deshpande
From India, Mumbai
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The medical expenses for injuries occurring during or while carrying out a job at work are considered occupational injuries and will be entirely borne by the company if the employee is not covered by ESI. If the employee is covered by ESI, the individual will be provided treatment and rehabilitation if required by the ESI.
If the employees exceed the ESI slab, the company will take out insurance for the employees, and the entire expense will be covered by the insurance claim.
From India, Chennai
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If the employees exceed the ESI slab, the company will take out insurance for the employees, and the entire expense will be covered by the insurance claim.
From India, Chennai
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Dear Ambitiousgrad,
Please find the details below.
Medical Allowance:
Medical Allowance is a fixed monthly allowance which forms a part of Salary. It is paid as a fixed amount which is determined as per the company’s policy where an individual is employed and it has no relevance with the medical expenses incurred. Medical Allowance is added in taxable income under the head “Salaries” and it is fully taxable.
Medical Reimbursement:
Medical Reimbursement is a reimbursement of medical expenses incurred by the employee. Employee claim this reimbursement by submitting bills, cash memos to employer and after verification employer reimburse the expenses upto a certain limit. This reimbursement is not pre-determined or fixed. Medical Reimbursement upto Rs. 15000 p.a. is exempt from Income Tax.
Mediclaim/Medical Insurance:
Mediclaim usually refer to Medical Insurance Premium or Health Insurance Premium. In other words, the premium paid towards policy taken on the health of the self, spouse, parents or dependent children can be claimed as deduction u/s 80D. But, the payment should be made by any mode, other than in cash to claim the deduction.
Deduction up to Rs. 15000/- is allowed in case of self and dependent children, an additional deduction of Rs.15000/- is allowed for premium paid towards the medical insurance of parents, that is, a total deduction of Rs. 30000/- can be claimed towards medical insurance premium of self, children and parents.
Further, in case the premium is paid towards any senior citizen (above 65 years), an additional deduction of Rs. 5000/- shall be allowed, that is, in case of senior citizens the above limit of 15,000/- shall be upgraded to Rs. 20,000/- .
More @ Taxmantra
From India, Bangalore
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Please find the details below.
Medical Allowance:
Medical Allowance is a fixed monthly allowance which forms a part of Salary. It is paid as a fixed amount which is determined as per the company’s policy where an individual is employed and it has no relevance with the medical expenses incurred. Medical Allowance is added in taxable income under the head “Salaries” and it is fully taxable.
Medical Reimbursement:
Medical Reimbursement is a reimbursement of medical expenses incurred by the employee. Employee claim this reimbursement by submitting bills, cash memos to employer and after verification employer reimburse the expenses upto a certain limit. This reimbursement is not pre-determined or fixed. Medical Reimbursement upto Rs. 15000 p.a. is exempt from Income Tax.
Mediclaim/Medical Insurance:
Mediclaim usually refer to Medical Insurance Premium or Health Insurance Premium. In other words, the premium paid towards policy taken on the health of the self, spouse, parents or dependent children can be claimed as deduction u/s 80D. But, the payment should be made by any mode, other than in cash to claim the deduction.
Deduction up to Rs. 15000/- is allowed in case of self and dependent children, an additional deduction of Rs.15000/- is allowed for premium paid towards the medical insurance of parents, that is, a total deduction of Rs. 30000/- can be claimed towards medical insurance premium of self, children and parents.
Further, in case the premium is paid towards any senior citizen (above 65 years), an additional deduction of Rs. 5000/- shall be allowed, that is, in case of senior citizens the above limit of 15,000/- shall be upgraded to Rs. 20,000/- .
More @ Taxmantra
From India, Bangalore
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