When your employer reimburses a work expense — fuel, rent, food, medical treatment, a cab ride, or an internet bill — a receipt is the document that makes that payment tax-free. Without one, the amount may be treated as salary and taxed at your slab rate. This guide explains the role of each type of receipt and what has changed under the new tax rules effective FY 2025-26 and FY 2026-27 (Assessment Year 2026-27).
Source: Tax slabs and regime details on this page are based on the official Income Tax Department portal at incometax.gov.in for AY 2026-27. Always cross-check with your CA or the official portal before filing.
The big change: new tax regime is now the default
From FY 2024-25 (Assessment Year 2025-26) onwards, the new income tax regime applies automatically to all salaried employees unless you specifically opt for the old regime. Budget 2025 confirmed this and made two significant updates:
- Standard deduction raised to ₹75,000 under the new regime (up from ₹50,000), with no receipts needed.
- Rebate under Section 87A raised to ₹60,000 for income up to ₹12 lakh — effectively zero tax for most employees earning up to ₹12 lakh under the new regime.
New regime tax slabs for AY 2026-27
These are the official slabs from incometax.gov.in for resident individuals under 60 years:
| Total Income | Tax Rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
Rebate under Section 87A: up to ₹60,000 if taxable income does not exceed ₹12 lakh. Health and Education Cess: 4% on tax plus surcharge in both regimes.
Which reimbursements are tax-free under each regime?
| Reimbursement | Old Regime | New Regime |
|---|---|---|
| HRA — rent receipts | Exempt under Sec 10(13A) with receipts | Not available |
| Fuel / vehicle reimbursement | Tax-free with actual bills | Tax-free with actual bills |
| Medical reimbursement (cash) | Up to ₹15,000/year exempt under Sec 17(2)(v) with bills | Not available — only employer-paid insurance premiums exempt |
| LTA — travel receipts | Exempt under Sec 10(5), twice per 4-year block with travel proof | Not available |
| Food / TA / DA on official duty | Per diem TA exempt with bills; meal coupons up to ₹50/meal | Per diem TA on official duty exempt; meal coupons unchanged |
| Telephone / internet bills | Fully exempt with actual bills under Rule 3(7)(ix) | Fully exempt with actual bills under Rule 3(7)(ix) |
| Cab / conveyance for official duty | Exempt with receipts for official travel | Exempt with receipts for official travel |
| Employer NPS contribution | Sec 80CCD(2): up to 14% (Govt) / 10% (others) of salary | Same — available in both regimes |
| Standard deduction | ₹50,000 flat — no receipts needed | ₹75,000 flat — no receipts needed |
If you are under the new regime: You do not need rent receipts for HRA, and the ₹15,000 medical reimbursement exemption does not apply. Fuel, telephone, internet, and official TA/DA reimbursements remain tax-free with actual bills regardless of regime. To opt for the old regime, submit Form 10-IEA to your employer before TDS is deducted.
Fuel bill — reimbursement for vehicle use
Fuel reimbursement covers petrol, diesel, CNG, and EV charging costs incurred during official duty — client visits, site travel, inter-office commute, or field work. It is tax-free under both regimes when supported by actual fuel receipts and covered under your employer's travel policy.
A valid fuel bill for reimbursement should show: the fuel station name and address, date, fuel type, quantity in litres, rate per litre, and total amount paid. IOCL, BPCL, HPCL, Nayara Energy, and CNG station receipts are all widely accepted. For EV charging, an invoice from the charging station works the same way.
Need a clean petrol, diesel, or CNG receipt for your monthly office reimbursement claim?
Open Fuel Bill Generator →Rent receipt — HRA exemption (old regime only)
House Rent Allowance exemption under Section 10(13A) of the Income Tax Act is only available under the old regime. Old Regime Only
HRA exemption — how it is calculated
The exempt amount is the lowest of these three:
- Actual HRA received from the employer
- Rent paid minus 10% of basic salary
- 50% of basic salary for metro cities (Mumbai, Delhi, Kolkata, Chennai) or 40% for all other cities
When the landlord's PAN is mandatory
If annual rent exceeds ₹1,00,000 (more than ₹8,333 per month), you must submit the landlord's PAN to your employer. This goes into Form 12BB and is reported in Form 24Q. Rent receipts must carry: landlord's name and signature, property address, tenant name, rent amount, period covered, and landlord's PAN where applicable.
Generate HRA-compliant rent receipts with PAN and revenue stamp field — free, no login.
Open Rent Receipt Generator →Restaurant and food bill — TA/DA and meal reimbursement
Food reimbursement under Travel Allowance or Daily Allowance for official duty is tax-free under both regimes. The employee must be on official travel, not commuting to the regular workplace. Meal coupons (Sodexo, Ticket Restaurant) are exempt up to ₹50 per meal under Rule 3(7)(iii), subject to two meals per working day.
A food bill for reimbursement should show: restaurant name, date, itemised food and beverage list, subtotal, GST split (CGST + SGST or IGST), and total amount paid. GST on restaurant dine-in and food delivery is 5% for most cases.
Generate a restaurant bill or food order receipt with GST for TA/DA reimbursement claims.
Open Restaurant Bill Generator →Medical bill — reimbursement under the old regime
Under the old tax regime, cash medical reimbursement up to ₹15,000 per year is exempt from tax under Section 17(2)(v) with actual bills. Old Regime Only
This covers the employee, spouse, children, and dependent parents. Under the new regime, this ₹15,000 exemption is not available — only employer-paid group health insurance premiums remain exempt.
Medical bills for reimbursement should show: hospital or clinic name, patient name, doctor's name and registration number, date of treatment, itemised charges, and total. Pharmacy bills must show drug names, quantities, and prices.
Generate a medical bill or pharmacy receipt for insurance and reimbursement claims.
Open Medical Bill Generator →Cab receipt — conveyance reimbursement for official duty
Conveyance reimbursement for official duty travel by cab, auto, or taxi is tax-free under both regimes with actual receipts. Regular commuting to the same office is not covered — it is a personal expense. Covered travel includes client visits, airport transfers, inter-office travel, and field assignments. Both Regimes
A cab receipt for reimbursement should show: the cab company or driver name, date, pickup and drop location, fare amount, and any GST charged. Uber and Ola provide GST-compliant invoices through their apps — download these before submitting your monthly claim.
Generate a cab or taxi receipt with GST for office reimbursement.
Open Cab Receipt Generator →Internet bill — telephone and internet reimbursement
Employer reimbursement for telephone and internet expenses is fully exempt from tax under Rule 3(7)(ix) of the Income Tax Rules — under both old and new regimes — when supported by actual bills. Both Regimes
There is no rupee cap on this exemption, unlike the ₹15,000 medical limit. The full amount reimbursed is tax-free as long as it is supported by an actual bill and covered under employer policy. This covers broadband bills, postpaid mobile bills, and WiFi charges for employees working from home or remotely.
Generate an internet or broadband bill for monthly reimbursement claims.
Open Internet Invoice Generator →Salary slip — proof of allowance structure
A salary slip is not a reimbursement receipt, but it is the document that establishes the allowance structure — how much HRA, conveyance allowance, medical allowance, and other components the employer pays. Without this, there is no baseline to validate a reimbursement claim against.
From FY 2024-25, employers must reflect the standard deduction of ₹75,000 in Form 16 computation. Salary slips showing old-regime components (HRA, medical allowance, LTA) remain valid for employees who opt into the old regime by submitting Form 10-IEA to their employer.
Generate a salary slip with HRA, allowances, and deductions for FY 2026-27.
Open Salary Slip Generator →GST invoice — for businesses claiming input tax credit
When a business reimburses an employee for a work expense and wants to claim input tax credit on it, they need a GST-compliant tax invoice — not just a receipt. The invoice must include the supplier's GSTIN, the buyer's GSTIN, HSN/SAC code, taxable value, and GST breakup (CGST/SGST or IGST).
For salaried employees, GST invoices are relevant when the employer is a GST-registered company and claims ITC on hotel stays, professional services, software subscriptions, or equipment purchased for official use.
Generate a GST-compliant tax invoice for business expenses and ITC claims.
Open GST Invoice Generator →How to organise reimbursement receipts for the year
- Keep a monthly folder — digital or physical — for each category: fuel, food, cab, medical, internet.
- Submit to employer payroll within the claim window (usually the 5th of the following month).
- Retain all copies for six years — the standard period for income tax scrutiny under Section 149.
- If you are on the old regime, collect rent receipts with landlord PAN before March each year — your employer asks for Form 12BB before computing final TDS.
- Scan every receipt the same day you receive it. Thermal paper from fuel stations and restaurants fades within a few months.
New regime vs old regime — which saves more? If your HRA, LTA, medical reimbursement, and Section 80C deductions together exceed ₹75,000, the old regime may save more tax. If not, the new regime with zero tax up to ₹12 lakh is simpler and better. Use the official tax calculator at incometax.gov.in to compare both before filing.
Frequently Asked Questions
Are employer reimbursements taxable under the new tax regime?
Most employer reimbursements for official duty — fuel, telephone, internet, and per diem TA/DA — remain tax-free under the new regime with actual bills. However, HRA exemption, LTA, and the ₹15,000 medical reimbursement exemption are not available under the new tax regime.
What is the income tax rebate limit for salaried employees in FY 2026-27?
Under the new tax regime for AY 2026-27, the rebate under Section 87A is up to ₹60,000 for individuals with total taxable income up to ₹12 lakh. This effectively means zero tax for income up to ₹12 lakh under the new regime.
Do I still need rent receipts if I am under the new tax regime?
No. HRA exemption under Section 10(13A) is not available under the new tax regime, so rent receipts have no income tax use for new regime employees. They are only required for employees who have specifically opted for the old regime by submitting Form 10-IEA to their employer.
What receipts are needed for a full and final reimbursement settlement?
For full and final settlement, employers typically require all pending fuel bills, medical bills, food or TA/DA receipts, rent receipts (if old regime and HRA was claimed), and any approved expense receipts from the employment period that have not yet been reimbursed.
Is employer NPS contribution tax-free under both regimes?
Yes. Employer contributions to NPS are deductible under Section 80CCD(2) under both old and new regimes — up to 14% of salary for Central and State Government employees, and up to 10% of salary for other employers.