Dear Friends, I have prepared 10 basic fundamentals about LEAVE TRAVEL ASSISTANCE/ALLOWANCE . I HOPE THAT PEOPLE WHO ARE NOT AWARE WOULD BENEFIT FROM THESE . KATYANA
From India, Gurgaon
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36From India, Gurgaon
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Thanks for the post. I have a question based on LTA. How a person can claim leaves under LTA at the time of leaving the organization? Apart from the allowance, do we also get some leaves? Neha
From India, Lucknow
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From India, Lucknow
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Hi Katyana,
Very well documented. Is there any way LTA can be put under the Flexible basket component, and then can the employee show international travel if he avails, say, a holiday to Bangkok with family?
In case you have information about how an employee can benefit from Car Maintenance & Petrol Reimbursement, please share it with us.
Thanks,
Swagata
From India, Calcutta
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Very well documented. Is there any way LTA can be put under the Flexible basket component, and then can the employee show international travel if he avails, say, a holiday to Bangkok with family?
In case you have information about how an employee can benefit from Car Maintenance & Petrol Reimbursement, please share it with us.
Thanks,
Swagata
From India, Calcutta
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Hi Swagtha,
As per LTA law (it comes in INCOME TAX ACT, SEC 10(5)), you cannot travel outside to claim LTA. It is meant for traveling inside India. An employee could benefit from saving tax if they opt for the reimbursement component of car maintenance and petrol reimbursement. To avail this, they need to produce petrol bills and maintenance bills for the car or two-wheeler. On submission of these bills, they can save tax. If they do not submit the bills, at the end of the financial year (February-March), the amount would be added to Special Allowance. After TDS deduction, they will receive that month's salary.
I hope I have clarified the query.
KATYANA
From India, Gurgaon
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As per LTA law (it comes in INCOME TAX ACT, SEC 10(5)), you cannot travel outside to claim LTA. It is meant for traveling inside India. An employee could benefit from saving tax if they opt for the reimbursement component of car maintenance and petrol reimbursement. To avail this, they need to produce petrol bills and maintenance bills for the car or two-wheeler. On submission of these bills, they can save tax. If they do not submit the bills, at the end of the financial year (February-March), the amount would be added to Special Allowance. After TDS deduction, they will receive that month's salary.
I hope I have clarified the query.
KATYANA
From India, Gurgaon
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Hi Katyana,
That was good insight about the LTA. But I need clarification on:
1) Can LTA be claimed by all the employees of an organization?
2) Or only if it is a component in their CTC?
Thanks,
Vidhya
From Canada, Calgary
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That was good insight about the LTA. But I need clarification on:
1) Can LTA be claimed by all the employees of an organization?
2) Or only if it is a component in their CTC?
Thanks,
Vidhya
From Canada, Calgary
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Dear Friends,
I need a few clarifications on LTA.
I was associated with a company for 11 months and 16 days (14 days short of a year). As per the CTC offered by the company, LTA was a part of the package. When I left the company, the notice period was short by 14 days, but I paid the notice pay of 14 days as per the Conditions of Service. During the full and final settlement, the Accounts Department of the company refused to pay the LTA for the year, claiming that LTA can only be claimed if the employee completes one year of service.
My argument to the Accounts was that LTA was a part of the CTC offered to me, so pro-rata computed LTA should be given, as done in most companies. The second argument was that I had paid the notice pay of 14 days, which was not only on the basic but on full wages.
However, the Accounts Department did not listen and declined my LTA. I could not request the HR as I was the HR Head there.
Can anybody guide me on which provisions of the law I can reference to claim the LTA, or what process should I follow to claim the LTA? It's a pity that the guaranteed amount of CTC is not being paid.
Regards,
Tusher
From India, Mumbai
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I need a few clarifications on LTA.
I was associated with a company for 11 months and 16 days (14 days short of a year). As per the CTC offered by the company, LTA was a part of the package. When I left the company, the notice period was short by 14 days, but I paid the notice pay of 14 days as per the Conditions of Service. During the full and final settlement, the Accounts Department of the company refused to pay the LTA for the year, claiming that LTA can only be claimed if the employee completes one year of service.
My argument to the Accounts was that LTA was a part of the CTC offered to me, so pro-rata computed LTA should be given, as done in most companies. The second argument was that I had paid the notice pay of 14 days, which was not only on the basic but on full wages.
However, the Accounts Department did not listen and declined my LTA. I could not request the HR as I was the HR Head there.
Can anybody guide me on which provisions of the law I can reference to claim the LTA, or what process should I follow to claim the LTA? It's a pity that the guaranteed amount of CTC is not being paid.
Regards,
Tusher
From India, Mumbai
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Dear Friends,
I have prepared 10 basic fundamentals about Leave Travel Assistance/Allowance. I hope that people who are not aware would benefit from these. Kindly give your suggestions on that.
Katyana
Very informative. You have mentioned that unused LTA is carried forward to the next year. In another place, you have also mentioned that LTA, if unused, would be added to your salary and taxed. Are both options available? If it is added, then when would it be added to my salary – in which month?
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I have prepared 10 basic fundamentals about Leave Travel Assistance/Allowance. I hope that people who are not aware would benefit from these. Kindly give your suggestions on that.
Katyana
Very informative. You have mentioned that unused LTA is carried forward to the next year. In another place, you have also mentioned that LTA, if unused, would be added to your salary and taxed. Are both options available? If it is added, then when would it be added to my salary – in which month?
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Hi,
Yes, out of 2 journeys, you can carry forward only one journey in a block of 4 years. If in case you are not taking 2 journeys in that block (the current one is 2006-2009), it could be forwarded to the next block (January 2010 - December 2013). In that case, it is mandatory to take your 1st journey in the calendar year of 2010; otherwise, at the end of that year, it would get lapsed.
The rest of the 2 journeys in a block of 4 years are taxable.
I hope I have clarified your query.
KATYANA
From India, Gurgaon
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Yes, out of 2 journeys, you can carry forward only one journey in a block of 4 years. If in case you are not taking 2 journeys in that block (the current one is 2006-2009), it could be forwarded to the next block (January 2010 - December 2013). In that case, it is mandatory to take your 1st journey in the calendar year of 2010; otherwise, at the end of that year, it would get lapsed.
The rest of the 2 journeys in a block of 4 years are taxable.
I hope I have clarified your query.
KATYANA
From India, Gurgaon
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Hi Shilpa,
Though LTA comes in the leave policy as it is a part of leave, in some companies, it is treated as a separate policy.
No, it is not mandatory to provide LTA. However, it depends on the internal policy of the company whether to include LTA in their CTC.
KATYANA
From India, Gurgaon
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Though LTA comes in the leave policy as it is a part of leave, in some companies, it is treated as a separate policy.
No, it is not mandatory to provide LTA. However, it depends on the internal policy of the company whether to include LTA in their CTC.
KATYANA
From India, Gurgaon
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Thanks a lot for the info. It was well put. Is there a site where we could get such snapshots regarding other compensation elements/legal compliances?
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Very Informative.. thnx for sharing. Is there any mandatory requirement for the quantum of leave to be taken to claim the LTA? Swati
From India, Vadodara
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From India, Vadodara
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Leave Travel Allowance.doc
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