Taxation

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Medical Allowance - Tax Treatment

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According to Clause 139 of part 1 (Exemption from total income) of 2nd Schedule of Income Tax Ordinance, 2001



a) If  Medical Facility or reimbursement of actual Medical expenses is provided:
  • in accordance with terms of employment: The amount provided is fully exempt if NTN of medical practitioner and employer's attestation are available.
  • Not in accordance with terms of employment: The amount provided is fully taxable
b) Medical Allowance provided: Tax Treatment is exempt upto 10% of Basic Salary

c) Medical allowance is provided in addition to medical facility or reimbursement in accordance with the terms: Tax Treatment is Medical allowance fully taxable and Facility / reimbursement is Fully Exempt if NTN of medical practitioner and employer's attestation are available.

d) Medical allowance is provided in addition to medical facility or reimbursement but NOT in accordance with the terms: Tax Treatment is Medical allowance is exempt upto 10 % of Basic Salary and Facility / reimbursement is Fully taxable.

Ref: Income Tax Ordinance, 2001

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posted @ 10:56 AM,

4 Comments:

At September 9, 2011 at 12:46 PM, Anonymous Anonymous said...

oye bhaiyo,aur unke beheno,what is da treatment of medical allowance

 
At January 23, 2014 at 12:27 AM, Anonymous Anonymous said...

If employer gives both Medical Allowance and Medical Insurance and both of these are not in terms of employment. Can employee select which one he/she wants to be exempted.

 
At June 3, 2014 at 12:00 AM, Anonymous Anonymous said...

What this in that condition, ntn not available then facility fully taxable, alloawnce 10%if b.s nd term if employment not avaliable 10%aliwane facility fully tax able

 
At June 3, 2014 at 12:03 AM, Anonymous Anonymous said...

Why he she

 

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