Leave Travel Assistance (LTA) has got a tax treatment which is quite different from all the other type of allowances and perquisites that you get. And that’s the primary reason it is the one that gets people confused more often than not.
The following points need to be kept in mind while taking the LTA or producing bills for it:
1. You can claim the LTA money every year regardless of whether you are going to claim tax deduction on it or not.
2. If you do not wish to claim LTA in one particular year you can have your employer carry – forward your LTA for the next year.
3. For getting LTA tax exempt you will have to produce bills, but you can’t get your LTA exempt every year.
4. You can get your LTA exempt twice in a block of four years. Right now the block that is relevant is 2006-2009. This block is decided by the Government so does not have a bearing on when you start your job and also these blocks are calendar years and not financial years.
5. The bills can be air, rail or even a private rental company however the exemption is only for domestic travel so an international ticket won’t do.
6. The bills have to be for a journey that has been undertaken when you are on leave and should be for you and your family that is spouse, children and dependant parents, brothers and sisters. Its obvious that your family can’t claim the exemption if you have not accompanied them.
7. If you and your wife both get LTA although obviously both of you can’t claim exemption for the same travel but you can avail exemption independently for different travels. So effectively between the two of you, you can claim exemptions four times in four years.
8. If for some reason you fail to claim exemption in the bucket of four years you still have the option to claim exemption in the first year of the next block.
9. Only travel bills can be used exemption, so a hotel bill can’t be produced for claiming exemption even though you might have stayed in the hotel during your leave.
10. The maximum LTA for the purposes of tax exemption is Rs.20000 so normally any most organizations design the salary structure in such a manner that they don’t give the employees more than Rs. 20000 as LTA.
11. In terms of proof for air travel although there is no fixed rule as such it might be a good idea to preserve the boarding pass along with the ticket to make sure there are no problems in claiming exemption later on.
12. LTA can only be claimed for the short distance between two places. So if you are planning to travel from Goa to Mumbai then you will be allowed exemption on tickets from Goa to Mumbai and bac. You will not be allowed to produce tickets that are via some other place like Mumbai to Hyderabad and then from Hyderabad to Goa and so forth.
13. LTA can only be claimed on tickets or rented private vehicles, you cannot show petrol or diesel vehicles for your own vehicles and then claim exemption on it.
– Source onemint.com
42 replies on “LTA Rules”
In the current year i get Rs.6000/- for LTA in this year shall i claim half the amt in first six month & balance in other six month
or i a year only one time
No.. only 1 trip per year and 2 times in the 4 year window can be funded by LTA
If the travel is made by rented private car, one is entitled to get exemption on entire amount OR First AC rail ticket amount between the source and destination city?
Please clarify.
it should be full amount spend… but do check with ur finance department before embarking on the voyage
What if ur company doesnt have an LTA component? Can u still claim an LTA exempt from the Govt when u file ur taxes?
actually what u need to do is to sit with the finance guys and make them retype the Form 16 (or your salary declarations) in a way that for that particular Financial year, LTA is being claimed… (and your compensation is reduced by that much amount)
then you can easily claim LTA. BTW this is applicable for indian companies only.
Two clarifications
1. In case I do not travel, can I encash the allowance with tax deduction for the full eligibility amount
2. If the above is possible, is it required to take compulsorily leave, in order to encah the LTA.
1. Yes you can. Or you could choose to carry the sum forward to the next year and then encash it at the end of the 4 year window. (and pay taxes)
2. It is important to be on leave when you are on a holiday. GoI still does not recognize work from home/holiday resort as work
I have a straight forward question.
I joined my company on July 2005.
And was entitled to receive LTA of 3000 Rs.(500 each month). I forgot to claim it against any journeys.
Now any ways I cannot claim that for any journeys, but should I get the money after tax deduction or not?
correction…
I wanted the clarification for the period July 2005 – Dec 2005.
As far as I knew the LTA is not more than one month’s basic salary which is tax exempted twice in a block of 4 yrs?
Can it exceed one month’s basic? Say my defined LTA in company’s offer letter is 15000 and I spent 20000 on my journeys. Will I get the tax rebate on 20000 or 15000.
i think the limit is 20k INR.. just check with the finance/payroll guys in your company
Query : i was working in small IT company Bangalore. The company deduct Rs. 900 for LTA evry month into my net Salary Amount. Now after 9 months i left the company and join in Pune. Now the problem is that my Banglore Prev company is not ready to give my LTA. So how can i claim with legal way ?
give a written complaint to the company’s Finance dept.. and if they don’t take any action on it for 2 weeks then u can take legal action
my basic salary is 11335 & i have recd LTA from co is Rs.6204,
I want to know how they have calculated the LTA.
I havn’t applied for LTA in the block 2006-2009. Planning to go on vacation from December 20, 20008 and will be back only on January 2, 2009.
My question is, Can I claim LTA benefit again in the financial year 2009-2010 ? (Probably my travel will be in October 2009)
Hi
The limit for tax exemption – is it INR 20,000/- per year or INR 20,000/- per trip (i.e. INR 10,000/- per year)
Pls clarify.
Thanks
Hi,
I just want to recheck whether LTA limit is just Rs 20,000/- , my LTA is 90,000 !!!!
Sencondly my company is not accepting car bills, i am planning to go to Manali ,from mumbai to chandigarh by air & than rent a car, company i not accepting car bill.Would like to know etails about rules for car renting bill
Regards
I havn’t applied for LTA in the current block . Planning to go on vacation from March 5, 2009
Can I able to claim the first LTA.
Again Can I able to claim the second LTA in the year 2009?
I wish to claim the LTA for the block 2006-2009 & having following doubts:
1. Can I claim two LTA exemptions in same year. i.e. can I claim LTA for Aug’08 & Dec-08 ?
2. Can I include my Husband’s expenses also in my LTA claim, though he is not in my dependents list ?
3. Can I claim LTA now for Dec’07 & Dec’08.
Thanks in Advance,
Taru
I am working with a multinational company in India. In May’08 , I moved on L1 visa to my US parent company where I am US employee. So in India I got only 1 month salary and I am having 0 tax liability for this financial year. Till now my total LTA have been around 1 Lakh with company. Is it is the right time to encash LTA even with taxable component ? Because even after adding LTA into my annual total income, I will not fall under tax liability ? Or LTA is always taxale and it doesn’t matter how much my annual income is ?
Pl. advise.
Thanks
I wish to claim the LTA this year 2009(its my first time) & having following doubts:
1.My travel is from Surat to Ooty
The trip is like this:
Surat to Mumbai – Train
Mumbai to Coimbatore – Air Flight
Coimbatore to Ooty – Rental Car
and vice versa.
So how can I claim for maximum exemption?
I mean shall i only show mumbai – coimbatore only? or full journey or any other way.
Thanks in Advance,
Chirag
Dear sir,
LTA is the part of my CTC.
Forget about LTA exemption and all.
Can i get the LTA without taking leave.
Yes, you can LTA amount without taking leave and travel, but after deduction of taxes
Hello,
Need urgent help.
I am working in a mnc at hyderabad. Last year 2008 I have claimed LTA (Tax-excemption) Hyderabad to Delhi. This year also I am going to claim LTA (Tax-excemption). But my HR people told me that I can claim LTA but I can produce bill for my home town journey only i.e from hyderabad to surat.
Is it true that LTA can be claim once for outside home town and other for home town journey only ?
Can’t I go two time outside of my home town in a block of 4 year ?
Need urgent response. Please mail me on patelkirtim@gmail.com
Thanks in advance.
Is there any rectriction that we sholud use atleast 3 earn leaves in our journey period in order to avial LTC?
@purna…
the rule says the travel has to be made while the employee is on earned leaves…. however many companies artificially introduce the constraint of min 3-5 leaves
i am working in a private firm and retiring at the age of 58 on 26 th september 2009.we are given one month basic salary as lta.if i retire in september of this year , am i entitled for full amount of lta (one basic) or proportionately(half basic) .
to avail lta we are supposed to take minimum 6 day’s earn leave.if i retire in september 2009 , how many earn has to be taken ?
I was employee of company X from april 07 to june 08.In this period that company gave me LTA but I never utilised it.And utilised that money in Feb 09.(That time i was employee of company Y).So how can I claim this for Tax Rebate?
Hi,
I travelled during May-09, also having bills, but now I changed my organzation can I claim my LTA amount in new organzation.
Thanks,
Rakesh
These rules are outdated.
Supreme Court ruling to L&T has changed these rules in Jan 2009.
Please update the same.
this is a march 2007 post. for that time period. I don’t know why people still refer to it
1- whether taxi fare is allowed?
2-minimum number of leaves required?
3-whether LTA can b claimed for travelling during official holidays?
4-if only family travel and employee keeps on attending office?
5-is there any maximum limit of LTA (tax exemption); if yes where it is provided. (RS 20000/-)
Dear Sir,
I have claim for LTA in Dec. 2009 for 2 Years (January 2008 to December 2009). I have produce bill of my travelling in June 2008 in December 2009.
Pl Clear me is it taxable or not.
Regards,
Mukesh Gupta
Hi,
I have declared my LTA as 40000rs. But I claimed only 25000rs. But I resigned In 25th-Feb-2010 itself. I have been working for 5yrs for this company. Now they are saying they will calculate LTA as pro-rata basis and hence I’ll get only 10810 only instead of 14500. (Ofcourse taxes will be deducted on this)
My CTC doesnt have any seperate component as LTA. I could opt for LTA, then it’ll be taken from Special Allowance.
Should I get 14,500rs or 10810rs? (before taxes apply)
Please let me know.
-ram.
can i claim LTA in the month of November and produce the bill for the month of March (actual LTA). can my accounts and HR treat the amount given earlier as advance LTA and attach the original bill with that? pls. guide
wHERE IS THE RULE MENTIONED THAT LTA CAN BE CLAIMED ON MIN 3 el(earned leaves
Hellow sir,
I am working in MNC since 2010 but i could not claim the year 2010&2011. now can i claim 2010-2012 if possible… please replay….
Can LTA/LTC be claimed without taking leave or actual travel? What is the IT rule for it and how much tax will be deducted for the same.
Best LTA strategy
Buy train tickets to the farthest place from where you are posted by the highest class you are entitled to. Take photocopies – then cancel your rail tickets. Then with the money go where you want, how you want. Ensure however that your leave coincides with the dates of the tickets that you have cancelled. Ensure that you are out of your house even if in another house in the same city.
@ramaswami
unfortunately our LTA limit is a % of basic salary and Kanyakumari to Jammu ACII train ride often does not exhaust the limit completely
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