LTA Clarification - CiteHR
Pon1965
Construction
Couvery
Consultant
Tegautham
Http://www.hinote.in/
Ranganathan L
Admin Executive
+3 Others

Prime Sponsor - FactoHR.com - Payroll Software with GPS Enabled Attendance, Travel, Performance Management, HRMS. Explore Features
We had been to Leh-Ladakh with family during June 2013.
We have travelled from Mumbai to Srinagar by flight and from Srinagar to Leh-Ladakh by road.
During this trip, I have incurred following cost for 3 persons
Route Mode Amount
Mumbai – Srinagar (and return journey) Flight ~29,000
Srinagar – Leh Ladakh (and return journey) Road ~65,800
Total Flight + Road 94,800
So, in the above case, how much LTA I can claim as tax free.

Cite.Co is a repository of information created by your industry peers and experienced seniors sharing their experience and insights.
Join Us and help by adding your inputs. Contributions From Other Members Follow Below...
If you have the proof of travel and bills for road transport, you can claim the entire travel bills except boarding and lodging as LTA for tax exemption. Note that you are claiming for 2 yrs and your limit of LTA is permitting the tax exemption.
pon, chennai
Unfortunately, calculation of tax exemption on LTA is complex when an employee visits multiple places by multiple modes of travel.
Please take a look at our blog post at https://www.hinote.in/tax-exemption-...ce-lta-part-ii if you wish to read about the approach to tax exemption calculation on LTA. Please take a look at the section "Leave travel to multiple destinations by multiple modes of transport".
You can avail the tax exemption on the whole amount of traveling for those you have proper bills if that comes under limit of your LTA.
Dear Rohit,

The following will apply when you claim exemption for LTA.

1. Exemption is available for two journeys in a block of four years and for the amount actually spent. Any other expenses incurred, such as food, hotel stay etc., cannot be claimed for the exemption.

2. LTA exemption can be claimed for family which means (i) the spouse and children of Individual, (ii) parents, brothers, sister of individual who are wholly or mainly dependent on him.

The exempted amount is computed on the following basis:

A) Journey performed by Air: Amount exempted is the lesser of Economy Air fare by the shortest route or the amount spent.

B) Journey performed by Rail: Amount exempted is the lesser of A. C. first class rail fare by shortest route or amount spent.

C) Place of origin and destination place of journey connected by rail but journey performed by other mode of transport: Amount exempted is the lesser of A.C. first class rail fare by shortest route or amount spent.

D) Place of origin & destination not connected by rail (partly/fully) but connected by other recognised Public transport system: Amount exempted is the lesser of First class or Deluxe class fare by shortest route or amount spent.

Extending the logic of option “C”, given that Leh and Mumbai are not connected by rail but are connected by Air. In my view, for your trip you should be entitled to claim the economy air fare for the sector: Mumbai – Leh – Mumbai.

Alternatively, the exemption (using option D) would be air fare for the Mumbai - Srinagar - Mumbai segment plus First class fare by buses run by JKSRTC for the segment Srinagar - Leh - Srinagar.

Regards

Raju Bhatnagar
Read the latest CBDT Circular on LTA.

XVI Leave Travel Concession (LTC):

The following are the important points, to be taken into consideration, for claiming exemption

u/s 10(5) of the Act read with Rule 2B of the Rules:

1. Definition - Value of LTC received by or due to an individual from his present or previous

employer, as the case may be, for himself and his family in connection with his proceeding on

leave to any place in India or to any place in India after retirement or termination from/of

service.

2. Number of Trips – The exemption shall be available in respect of 2 journeys performed in

the block of 4 calendar years.

• Without performing any journey and incurring expenses thereon, no exemption can be

claimed.

• The quantum of exemption will be subject to the following maximum limits for

journeys performed on or after 01.10.1997

Journey Performed by Exemption Limit

1 Air Air Economy fare of the national carrier (Air India) by

the shortest route to the place of destination

2 Places connected by rail

and journey performed by

any mode other than by air.

First Class Air conditioned rail fare by the shortest route

to the place of destination

3 Place of origin and

destination or part

thereof not connected by

rail.

a) Where public transport system exists, first class or

deluxe class fare on such transport by the shortest route to

the place of destination.

b) Where no public transport system exists, first class A/C

rail fare, for the distance of the journey by the shortest

route, as if the journey has been performed by rail

o This exemption is limited to the actual expenses incurred on the journey which in turn is

strictly limited to expenses on air fare, rail fare and bus fare only. No other expenses like

local conveyance, sight-seeing expense etc., shall qualify for exemption.

o Where the journey is performed in a circuitous route, the exemption is limited to what is

admissible by the shortest route. Likewise, where the journey is performed in a circular

form touching different places, the exemption is limited to what is admissible for the

journey from the place of origin to the farthest point reached in India, by the shortest route.

• Restriction on children – The exemption will not be available to more than 2 surviving

children of an individual born after 01.10.1998. This restriction shall not apply in respect of

children born before 01.10.1998 and also in case of multiple births after one child. It may

be noted that section 2 (15B) of the Act defines a child as includes a step child and an

adopted child of the individual.

• Definition of Family – As per the provisions of the Rules, family means:

o Spouse and children of the individual.

o Parents, brothers and sisters who are wholly or mainly

dependent on the individual.

• Foreign Travel – As per the provisions of the Rules, exemption is not allowable in case of

travel abroad.

• Obligation of the employer –The employer has to satisfy the obligation that leave travel

(fare) concession is not taxable in view of section 10(5) the employer is not only required to

be satisfied about the provisions of the said clause but also to keep and preserve evidence in

support thereof.

Some important points to be considered are as under:

1. It is uniform for all employees

2. Where an employee does not avail LTC, either one or on both the occasions during

the block of 4 calendar years, the value of LTC first availed during the first calendar

year of the immediately succeeding block shall be eligible for exemption in lieu of

exemption not availed during the preceding block Only one trip can be carried forward

to be availed in the immediately succeeding block.

3. Quantum of Exemption – The basic rule is that quantum of exemption will be limited

to the actual expense incurred on the journey.

Any Leave encashed for the purpose of Leave travel or home travel concession is taxable.
Dear Rohit,
You could claim LTA exemption in respect of any two journeys in a block of four years. The current block is 2010 to 2013. Say for example, you claim LTA exemption in 2010, then you could claim just one more till 2013. An important thing to keep in mind here is that, the four years are calendar years and not financial years.
Thanks,
Rohit Singh
Dear Rohit, Thanks for the valuable information. I have query that in a block of 4 yrs shall I claim the amount of 2 journey in single journey i.e by 2013 Nov. Please confirm. Regards, Ranganathan
Pls. clear the point, then i can help you. Regards, Rohit Singh
Prime Sponsor - Talentedge.com "Interactive Anywhere Learning". Executive courses from top reputed institutes like IIM, XLRI, MICA. View Courses
This discussion thread is closed. If you want to continue this discussion or have a follow up question, please post it on the network.
Add the url of this thread if you want to cite this discussion.






About Us Advertise Contact Us
Privacy Policy Disclaimer Terms Of Service



All rights reserved @ 2019 Cite.Co™