Curious About Leave Travel Allowance? How Is It Calculated and What Are the Benefits?

Hello dear friends,

I want to know some details of the Salary Component LTA and how LTA is calculated. Does the company have any benefits in giving LTA to employees?

Regards,
Vinay

As per my understanding, the Leave Travel Allowance is subject to a maximum of Rs 15,000 per annum and should be reimbursed once in 2 years to avail of a tax benefit. Some companies would offer a part or a maximum of Rs 15,000 per annum to their employees as part and parcel of their Cost To Company (CTC).

I hope this information helps you.

Best wishes

Hi,

Leave Travel Allowance is part of the CTC and it is an annual component subject to a maximum of Rs 15K; and in some org it is given based on the role also, and it varies.

Regards,
Shanthi

Hi Vinay,

LTA is a part of the salary, and it amounts to 10% of the Basic. It is deducted from the salary every month. At the end of the year, you can claim it by producing the tickets after taking a minimum of 4 days leave. If anyone does not claim it, the amount will go to the company's accounts, which is a benefit for the company.

Please let me know if you need any further clarification.

With the new tax regime, I think LTA is going to be taxed or scrapped. For the status quo, maintain the Rs15,000 limit (tax-free); any amount more than this attracts taxation. I hope this ends the matter.

I am working in Himachal Pradesh. In my salary structure, LTA is deducted at 8.335% on CTC. However, in the Delhi region, I have heard that it is between 10% to 20% on CTC. Which one is correct? Please suggest.

Thank you in advance.

Please email me at [Email Removed For Privacy Reasons].

Thank you.

The LTA is usually calculated at 10% of the Basic Salary. You should not calculate it against the CTC. CTC is a different component that consists of your Basic, Allowances, Retirals, Bonus, etc.

Regards,