Tax Exemptions for Leave Travel Allowance (LTA). This article specifically talks about the exemption which is provided to the employees for the leave travel allowance they get from the employer for being on leave and traveling for official work. Leave travel allowance is allowed only if the employee claims leave and goes on a vacation and only if submits the actual bills of the journey. However the same is not required for income tax purposes, but it is always a safer side to keep handy the original bills. Now check more details regarding "Tax Exemptions for Leave Travel Allowance (LTA)" from below.
Tax Exemptions for Leave Travel Allowance (LTA)
Explanation:The Leave Travel Allowance is allowed only if the allowance is received for domestic travel in India. The International journeys would not be covered under this allowance, i.e. they can claim allowance only if:
- Allowance received for place in India
- For any place in India after retirement or termination of services.
How to calculate LTA ??There may be cases to calculate LTA, they are
- When journey is performed by Air – Exemption upto the Economy class fares of Airlines can be allowed as exemption.
- When journey is performed by Rail – Exemption upto fare equivalent to the Air conditioned First class Rail ticket. But here the actual journey preferences should be considered, i.e. if the journey is done by way of normal sleeping coach then the journey can be exempted only upto the fares of the actual fares paid for the sleeping coach and not the AC coach Ticket fare.
- Any other vehicle – Exempted only upto the fare equivalent to the 1st class or deluxe class ticket of such mode of transport for the shortest mode of route possible for reaching the destination.