Defining Exemptions on Medical Reimbursement 

Purpose

This process describes how to define the wage types for Exemption on Medical Reimbursement and assign characteristics to it.

Prerequisites

You must have maintained the details of the medical bills, submitted as proofs by the employee, in the Exemptions infotype (0582) MDA subtype.

Process Flow

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       1.      You must define the tax code for medical reimbursement. To do so, go to the IMG under Payroll India ® Tax ® Tax Liability on Reimbursements, Allowances and Perks ®Define tax Codes. The tax code used for the Exemptions infotype (0582) MDA subtype for:

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                            a.      Medical Reimbursement is SMED

                            b.      Medical Reimbursement treated as Insurance is SMTI

       2.      You must configure the wage type for the Exemption Limit and the Tax Code. To do so, go to the IMG under Payroll India ® Tax ® Tax Liability on Reimbursements, Allowances and Perks ®Assign Tax Code limits to Wagetypes.

For further details on configuring the wage type, see INVAL.

For details on configuring each IMG activity, refer to the IMG documentation.

See also:

Medical Reimbursement