No cap on sop at employer- owned hospital

QI purchased a flat by taking a loan in August 2017 and will receive its possession in November 2018. I want to know whether the interest benefit is available to me for the assessment year 2018- 19 ( FY2017- 18)? AKASH MISHRA

Via email

A) You will not be entitled to claim interest on housing loan for the assessment year 2018- 19 ( FY2017- 18). As per the explanations to provision of Section 24( b) of the Income Tax Ac: “Where the property has been acquired, constructed, repaired, renewed or reconstructed with borrowed capital, interest, if any, payable on such capital borrowed for the period prior to previous year in which the property has been acquired or constructed, as reduced by any part thereof allowed as a deduction under any other provisions of this Act, shall be deducted under this clause in equal installments, for the said previous year and for each of the four immediately succeeding previous years.” Interest pertaining to assessment year 2018- 19 will be deductible in five equal installments beginning with assessment year 2019- 20.

QI intend to gift some shares purchased more than three years before to my sister by way of off- market transfer from my demat account to her demat account. These transfers do not attract any liability of Security Transaction Tax. I want to know whether these transfers will attract capital gains tax or gift tax either in my hands or my sister’s. Kindly give your opinion. ROHAN V. Via email

A) After the amendments in Section 56, with effect from October 1, 2009, transfer of any property ( which includes shares and securities) without adequate consideration will attract tax liability in the hands of donee ( receiver).

This provision is, however, not applicable where the property is received from any “relative”.

Brother- sister relationship is included in the term relative. Therefore, the shares gifted to your sister will not attract any liability to capital gains tax.

QMedical eimbursement charges granted to an employee by the employer, exceeding ` 15,000 per annum will be treated as a perquisite and taxed accordingly. If the hospital, where he was treated, is an employer- approved hospital, can total medical re- imbursement charges be exempted without any ceiling? Does the Income- Tax Act recognise any difference between employer-approved hospital and government- approved hospital? VENU GOPAL Via email

A) The perquisite in respect of medical facility provided by an employer in the following hospitals/ clinic is not chargeable to tax:

Hospital owned/ maintained by the employer

Hospital of central government/ state government/ local authority,

Private hospital if it was recommended by the government for the treatment of government employees,

Specified medical facility ( given in rule 3A) in a hospital approved by the Chief Commissioner.

Any other expenditure incurred or reimbursed by the employer for providing medical facility in India is not chargeable to tax up to ` 15,000 in aggregate per assessment year. Therefore, the exemption, in the instant case, will be subject to ceiling of ` 15,000 as the employer-approved hospital is not owned or maintained by the employer.

( The writer is a chartered accountant. You can your send queries to info@rathiandmalani.com )