Are Transport and Conveyance Allowances the Same? Seeking Clarity on Salary Slip Confusion

Dear experts,

Could you please clarify whether transport and conveyance allowances are the same or different? I have observed both of these allowances on a salary slip. Your guidance on this matter would be greatly appreciated.

Thank you.

Dear Mridula,

Transportation allowance is the travel expenses of an employee to commute from home to the office and back. This is usually part of the salary and, as per IT rules, in most companies, it is termed as Conveyance allowance, which is up to Rs. 800 per month exempted from IT without any bills. This amount of exemption is proposed to increase from Rs. 800 to Rs. 1600 per month and is awaiting approval from the Government.

Best wishes,
Jayaprakash

I think the best person to explain the difference is the HR or Payroll manager in your office. Each company has a different rule, and it is not possible for a third party to give you an answer.

Transport Allowance and Tax Exemption

The transport allowance or conveyance allowance is an allowance granted to an employee to meet his/her expenditure for the purpose of commuting between the place of residence and duty. Transport allowance is exempt to the extent of Rs. 1,600 per month, i.e., up to Rs. 19,200 is exempt for a year. Any amount paid over this limit is taxable. For example, if an employee is getting Rs. 3,000 as transport or conveyance allowance every month, Rs. 1,600 is exempt and Rs. 1,400 is taxable per month. Thus, out of Rs. 36,000 transport allowance received for the year, Rs. 19,200 would be exempt, and Rs. 16,800 would be taxable. The exemption limit has already been increased from Rs. 800 to Rs. 1,600 w.e.f. 1 April 2015.

Best wishes,
Jayaprakash