Accounts & Administration, Tax
Human Resource
Accountant In Construction Company
+5 Others

Hi All, Please tell me about the LTA calculation. Regards, Md. Shoaib Alam.
26th January 2010 From India, Gurgaon
Pleased to provide you this information.
Terms for LTA:
1) The Travel should be made within India
2) The employee should have been on leave during the time of travel.
3) One Round Trip (To & Fro) is only allowed.
4) LTA has a concept of Block years. One Block is made up of 4 years.
5) The current Block is from 2010 to 2013.
5) An employee can claim LTA as twice as non-taxable in a block. The other two instance is any way subject to tax.
6) The mode of travel should either by Train/Public Transport/National Carrier. Else exemption would be restricted to such extent.
7) The trip should have been made by the shortest route possible.
Hope these points would suffice your requirement.
Thanks & Regards,
Mohan Kumar. B
26th January 2010 From India, Pune
Hi Mohan, Can you please explain - An employee can claim LTA as twice as non-taxable in a block
27th January 2010 From United States, San Jose
Hi, I still can not understand what is LTA. I need to make it understand by the help of you people, please. Falak
27th January 2010 From Pakistan, Karachi
Hi, LTA means Leave Travel Allawances. If an entitled employees gone on Earned leave for tour purpose, then to and fro fair will be reimbursed as LTA as per their eligibility criteria.
27th January 2010 From India, New Delhi
Hello, How to calculate LTA, what % of basic salary will be exempted from tax under this parameter. Mani
27th January 2010 From India, Mumbai
The must be calculated considering Basic + DA, as per statute. But some companies do calculate on Gross Salary also. There is no rule as to how much amount has to be allowed, but the general practice is to allow one month's Basic + DA, and in order to claim LTA the employee must proceed on leave for a minimum of 3 days.
The LTA must be given 2 times in the block of 4 years, ie., The employee must produce the proof of travel and other expenses. Wherever he has not produced the bill, Income Tax has to be deducted by your Finance Dept. If you wish so, you may opt to give once a year also, but you can exempt your employee from Tax only once in two years.
28th January 2010 From India, Bangalore
I agree with guruprassana..at our office we give this benefit every year and there is tax exemption only alternate years...we have a fix eligiblity depending on the various grades..n calculated on basis of days worked i.e Eligibility /365* No. of days worked...
hope this helps you.
please forward ne further query or anything you know bout it..
Great process of learning.
28th January 2010 From India, Pune
Re: LTA Calculation
This court order came after a hearing of case between Larsen & Toubro and*income tax department*of*India. Income tax department had argued that employer has to collect proofs from employee for LTA. Rejecting this, the supreme court in its order said: “The beneficiary of exemption under Section 10(5) (of the Income Tax Act) is an*individual employee. There is no circular of Central Board of*Direct Taxes*(CBDT) requiring the employer under Section 192 to collect and examine the supporting evidence to the*declaration*to be submitted by an employee(s).”
Hence, from now on,*Employee*will not have to*submit proofs*as evidence, to their*employers*for getting*LTA*(leave travel allowance)*reimbursement.
Thanking you
Sanjeev Kumar
28th January 2010 From India, Calcutta
LTA calculation is done taking into account the designation/cadre of an employee.
It varies for different companies - eg-
LTA is given in the company depending upon different rules/norms.
It is normally given to an employee after every 2 or 3 years of service period in the organization.
An employee shall be entitled for allowance subject to a maximum distance (to & fro) of 4000 Km. An employee who is posted at a place which is more than 1000 Km. away from his home town, shall be entitled for allowance for an additional 1000 Km.
A person should also have EL (earned leaves) in their account.
It is also on the subject if both husband and wife are workign in the same organization, only 1 has the priviledge of availing the same.
There are also various rules involved in the same.
Lemme know what exactly you are looking for.
28th January 2010 From India, Chandigarh
I am working with a construction company, our client allways deduct the TDS on our Total bill amount(Workdone+Service Tax), now i want stop deduction TDS on Service Tax amount tell me some thing about same
Rakesh Sharma
29th January 2010 From India, New Delhi
Hi All,
Please note that even though The Hon'ble Supreme Court has given a verdict stating that an employer is not required to ask for proof of travel from the employee to provide exemption for the LTA Payment.
It would be noteworthy to look into the circumstances that led to this verdict. If people would go through the verdit carefully, all could note that the verdict says that "Since the section related to LTA is not covered under Sec 192 B (section regulating Tax on Salaries), it is not binding on the employer to collect the proof".
Please note that the Central Board of Direct Taxes (CBDT) can at any point of time notify and bring this under the purview of Sec 192 B with retrospective effect.
Therefore it is always advisable to collect the proofs to be on a safer side.
30th January 2010 From India, Pune
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