Reimbursement on investment declaration

Reimbursement is the act of compensating someone for an out-of-pocket expense by giving them an amount of money equal to what was spent.

If your organization wants to reimburse employees for tax benefits on certain categories, you can create a category in reimbursement (with the same name as in the salary template), define its limits, make it taxable and select the payout mode as none. The employee can then apply for the reimbursement in the selected category from the Main Panel. Once the admin approves it, the amount is added to the respective category of the employee’s income tax declaration.

Example: If an organization wants to reimburse employees for telephone bills, it can create a reimbursement category called "telephone allowance" (with the same name as in the salary template). Employees can declare the amount to be reimbursed under this category. After the admin approves it, the amount is added to the same "telephone allowance" section in the employee’s income tax declaration.

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Follow these steps to manage reimbursement categories:

1. Navigate to Control Panel → Payroll → Reimbursement.
2. Click the Categories button (in the navigation bar). A new page opens, showing fields to manage the categories.
3. Select the Component Type (Medical, Conveyance, LTA, Taxable, Non Taxable).
4. Enter the Name of the reimbursement category.
5. Enter the Description for the reimbursement.
6. Enter the Financial Year for which the reimbursement is to be made.
   
   1. Pro Rata basis: Allows you to reimburse the amount on a pro rata basis depending on the exempted limit specified for the category.
   2. Is Elapsable: Select this box to let unclaimed reimbursements lapse at the end of the financial year.
   3. Is CTC: Makes the reimbursement amount a CTC component when the employee has submitted all the required documents and the employer has verified them. The employee can view the reimbursement in the CTC by clicking Compensation → My Compensation on the Main Panel.
7. Payment Mode: Select None as the payment mode.
   1. (None: The reimbursement is recorded, but no payment is made to the employee.)

6. Monthly Limit: The monthly reimbursement limit for the category.
7. Yearly Limit: The maximum reimbursement that can be made for the category in a year. The yearly limit has the following options available:
   
   1. Enabled: Makes the monthly limit visible in the reimbursement section of the employee’s portal.
   2. Allow self-declaration: Allows the employee to edit the reimbursement value against the category from the Main Panel.
   3. Show in Investment Declaration: Displays the reimbursement category in the Investment declaration for the employee.

The entry appears in the table below on the same page. Employees can now apply for the reimbursement under the same category.

Applying for a reimbursement amount:

• Navigate to Main Panel → Reimbursement.
• Enter the Title, Description.
• Select the Category (in this example, telephone allowance).
• Enter the Amount and upload the receipt in the Upload Document field.
• Click the Apply button to apply for the reimbursement. A Reset option is also available.

The request is sent to the admin. Once the admin approves it, the amount is added to the respective category of the employee’s income tax declaration (Control Panel → Payroll → Investment).