TDS on Medical out door reimbursement to retired employees - Reg

[CMA VENKATESHAM MUTA]

Sir/Madam,

Employees retired from service and they are getting a pension of ₹ 50,000/- per month from Dept of telecom (DOT), and we , BSNL, reimbursing the medical expenditure to the retired employees approximately 80,000/- per annum. Please clarify

1) Whether BSNL is liable to deduct TDS from the medical reimbursement paid to retired employees.

2) If so, Whether we need to consider the pension amount also for consideration of slab rate for TDS.

Kindly clarify the above please.

AI Summary

TDS of 10% applies to BSNL medical reimbursements over 15,000 annually; pension handled separately by DOT. A discussion on a forum involves queries about the tax deduction at source (TDS) on medical reimbursements for retired employees of BSNL. A retired employee receives a pension from the Department of Telecom (DOT) and medical reimbursements from BSNL. The main questions are whether BSNL should deduct TDS from these reimbursements and if the pension amount should be considered for TDS slab rates. Responses indicate that TDS applies if medical reimbursements exceed 15,000 annually, with a 10% rate, and is separate from the pension, which is handled by DOT.