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 to get LTA Exemption:
Can We Claim LTA Every Year?
One of the most common questions about LTA is whether it can be claimed every year or not? The answer is Yes – you can claim LTA every year, but you will not be able to claim LTA exemption ever year.
Other Points About Tax On LTA
- 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.
- For getting LTA tax exempt you will have to produce bills, but you can’t get your LTA exempt every year.
- 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.
- 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.
- 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.
- If you and your wife both get LTA – 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.
- If for some reason you fail to claim LTA exemption in the bucket of four years – you still have the option to claim exemption in the first year of the next block.
- Only travel bills can be used for LTA exemption, so a hotel bill can’t be produced for claiming LTA exemption even though you might have stayed in the hotel during your leave.
- The maximum LTA for the purposes of LTA tax exemption is Rs.20,000 so normally most organizations design the salary structure in such a manner that they don’t give the employees more than Rs. 20000 as LTA.
- 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 LTA exemption later on.
- LTA can only be claimed for the shortest 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 back. 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.
- 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.
The above are just some of the points that need to be kept in mind while discussing LTA exemptions. Because tax rules keep changing it is best to discuss with a professional before taking any decision.
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Good article.
Can you please clarify the folowing points:
1) LTA tax exemption limit:
I have been told by a professional organization that there is no top sealing/exempton limit for LTA. Any amount of actual bills can be billed for a continuous journey.
2)Journey Route:
Please elaborate on second last point of short journey. Suppose if i am travelling from Delhi to Manali, there can be two possible routes:
a) Delhi-chandhigarh-Kullu-Manali
b) Delhi-chandhigarh-Shimla-Kullu-Manali
So if i choose either of the above, can i claim exemption?
Waiting to see your reply.
Thanks,
Vishal
Hi Vishal,
I don’t think that there can be a case when there is no limit at all, In which case you can get your entire salary as LTA, produce a bill and get all of it tax exempt!
However its best to follow the advice of professionals looking at your pay stubs specifically.
Again for the route that you have decided you gotta get in touch with them to see what is the explanation to the act.
Thanks,
Manshu
Hi,
Does one have to provide bills for the entire amount?
-Arti
Yes Arti one has to produce bills for the entire amount to get exemption.
quote
“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.”
unquote
pls. clarify the above point, that the amount of Rs. 20,000/-
is the maximum for one year or claiming above Rs.20,000/- is taxable ?
Claiming above 20,000 is taxable. So till 20k, the normal rules apply (mentioned above), but above that everything is taxable.
Hi, Thanks for all the information. It is quite helpful. I have one small query though… In case of travel by road— what is the requirement? Like we took a hired car to travel to Dalhousie and back, is that taxable??
Sir i want to know that can an employye take LTA for three year in one time and second in above case amount will be taxable or not ?
I don’t think your employer will allow you to take three future years LTA at one go Suresh. You can check with your HR but I really doubt it.
sir, i have lta examption taken on 2007, that time i have prodused bil amount 14000.00 RS. that time my lta eligible limit was 7500.00 RS.and examption also taken only 7500.00RS. shell i take again lta examption on 2008.
sir,
your information given useful knowledge. i have a situation and hope u could suggest me.
i joined one mnc comany in a month of oct, 2008 and i am going to resign the job and my salary is 26k. from my salary my employer is dedicting 800/- per month. my query is can i claim the lta by producing respective bills from the present employer on or before exit date?
provide me with the best suggestion.
Sir,
Can i claim LTA as taxable without producing bills. If yes then, what will be the tax structure? Will it be added to head salary?
Please suggest.
Yes Navaneeth, you can claim LTA as taxable without the bills. The amount will get added to the head salary. Based on your bracket, you will be taxed upon it.
Hello Manshuv,
I need to claim LTA exemption this year.
My salary has LTA component of 2500/- per month.
My journey is from Surat – Ooty in following manner:
Surat to Mumbai – Rail
Mumbai to Coimbatore – Air
Coimbatore to Ooty – Bus or Taxi
and vice versa.
So how to claim LTA in this case.
Also is the airline should be AirIndia/India airllines or any carrier is allowed.
Hi Chirag,
It can be any airline or even a train or bus ticket. As long as your journey has been made in one leave break.
It has to be the shortest distance between two places so that needs to be taken into account.
Dear Manshuv,
I need to know that if I produce a LTA bill on 12 Feb 2008, then whether I will be eligible to get LTA that has got accumulated till:
a. March 2008
b. Jan 2009
c. Till date (12 Feb 2009)
d. Any other date that is applicable. (Please state the date in this case)
Further, I had claimed for LTA around August 2008, the employer/company has payed me LTA till March 2008. Please let me know whether I can submit a fresh bill of amount that is equal to LTA that will accumulate from Apr 2008 to Dec 2009. Which duration should I consider for which I’ll surely get the money. For remaining duration, will I get the remaining amount/money on monthly bases, or will I get it after every financial year?
Please help.
Thanks & best regards,
Rajeev Arora
I have claimed LTA for thif FY amounts to Rs 41000/- on Taxi bill for journey of 4 persons incl me of my family but i got the exemption of Rs 36000/- only.
Our HRD confirmed that reason for getting lesser exemption is due to calculation of equivalent distance’s least fare by Ist class AC rail fare which amounts to only Rs 36000.
SO IS IT TRUE ? that taxi bills in LTA have calculation based on Ist class ac rail fare for exemption ?
Hey nilesh,
can you tell me the route which you travelled from-to so that you got 36000 as LTA.
As i came to know from my collegue that my company has given only 17000 as LTA even if he has kept for 42000 claim based on his route calculation. Hence request your route.
Please send the details to my mail id.
Hey nilesh,
can you tell me the route which you travelled from-to so that you got 36000 as LTA.
As i came to know from my collegue that my company has given only 17000 as LTA even if he has kept for 42000 claim based on his route calculation. Hence request your route.
Please send the details to my mail id.
Regards,
vamsi
Any clue on limit on No. of Bills Submitted ?
If i am claiming LTA of 20k, then should it come of only two bills (that is two journey) or even more than 2 would do ?
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.
Nilesh,
That limit is correct. You can’t go more than First Class Fare. However, in one case – A bank officer had claimed filed a writ against this appeal as his Air Fare was higher than the Train Fare.
In your case, I don’t think a taxi fare will be allowed to exceed the First Class Fare.
Look at this:
http://www.taxmann.com/DitTaxmann/IncomeTaxActs/2006ITAct/%5B2005%5D142Taxman0064(Ker).htm
@Gaurav,
The journeys should be within one time period in which you took leave. Also the act mentions the shortest distance between two places.
@Rajeev,
Sorry, But your’s is a specific question that I don’t know the answer to.
Kirti,
Rule 2(B) (act which clarifies LTA) doesn’t talk anything about home-town, so I am not sure what your HR is referring to. You can ask them about which section or case – this particular clause is in.
Gaurav, Chirag –
The bills have to be for the shortest distance between two places.
Hello,
For claiming LTA, do we need to boarding passes ? My company is asking for the boarding passes as a verification. Since i have mistakenly not retained the boarding passes, what alternative do i have to claim LTA ?
Supreme Court has recently passed an order which states that proof of LTA is not needed.
Check with your HR about this new Supreme Court Ruling.
Please tell me if i have travled by innoova car for 4 members of my family. the taxi bill is 24000rs.
last year i got LTA is 10000 rs & this year is 12000 rs could i get exmption on 23000 rs this year if I havent claimed LTA last year.
How much would be the LTA tax exemption it is 24000 rs or 22000rs actuall amount. pls help
MAK,
You can’t combine the LTA of two years and claim exemption for it.
Dear Sir,
I want to know the exact meaning for round trip for availing LTA for example if i am hiring taxi from bangalore to Chennai & covering some via places then for LTA calculation via places are covered or from source to destination
For availing LTA if husband & spouse are travelled by air in the different dates while back both are travelled by air in the same date in this case spouse onward journey can be considered for LTA calculation so please reply me in this regard.
Can I claim LTA as taxable without producing bills. If yes then, what will be the tax structure? and how I will calculate..?
@Gokul – The exact definition is the shortest possible distance between two places, so if you went via some other place, it won’t be covered.
@Vijay – You can claim LTA as taxable without producing bill. The amount of the LTA will be added to your salary and you will be taxed acc to the bracket you are in.
However, Supreme Court has recently passed an order which states that proof of bill is not required for claiming exemption. I am not sure of the intepretation of this rule but you can surely check with your HR.
My company is paying LTA every month. So please let me know whether I am eligible for exemption. If yes then what will be my exemption. I am getting Rs1800 every month as LTA component.
Yes Jagdish, even if your company is paying you monthly — you are eligible according to the regular norms.
Hi Manshu,
I appreciate you for providing such helpful information.
I have not claim LTA for years 2006, 2007, 2008 and going to claim for 2009. I had a travel trip in year 2006 and 2008 as well.
I can claim LTA exemption for the year 2009.
Now if I’ll claim LTA for year 2006, 2007 or 2008, will I get the LTA exemption for any of these years? Or I’ll only get the LTA which will be taxable?
Can you please suggest a optimum way in my case, to claim the LTA along with exemption?
Hi,
If I have visited From Delhi to Rishkesh by private taxi (rented), can i charged the amount of Hire charges as against claim of LTA for any particular Calender Year.
Awaiting response on urgent basis.
Regards,
Anil Kumar
Yes Anil, people use taxi bills to charge against LTA all the time.
Hi manshuv,
I want to know two things 1) if i dont go any where in a particular year then how can i get that LTA amt that is been included in my salary structure . 2) is it compulsory to include LTA in Salary structure suppose i dont want to bifer X amt as LTA in my salary structure i want to adjust that particular amt in basic salary structure is it possible
Please revert back soon
Regards,
Amit
1. You can just ask your HR to pay it at the end of the year.
2. That entirely depends on company policy to the best of my knowledge. Let me also add that I don’t think there is any benefit to be had from taking the allocation from LTA to Basic.
what is the limit on LTA when road bills are claimed?
how would a private taxi provide road bill?
Akansha the limit remains the same regardless of what mode you use. Most taxis do provide a bill. Which part of the country were you looking at? Right at the time of calling them up, you can ask them to be ready with a bill and they will.
Dear Sir,
if a Properitership firm was started on 01.04.08. so, in this case can employee get the Tax Exemption benefit 2008-09 & Dec. 2009 twice on the withdrawn of LTA.
& from 01.01.2010 – 31.12.2014 employee can withdrawn the LTA twice as per thr act block years.
Regards
vijender
What is the maximum amount of lta that can be claimed as exemption from tax in 1 financial year.Say if actually rs 45,000 are spent in 1 single travel, can all be claimed or only rs 20,000 per annum, as mentioned in a few above question/answers..And under what section should thsi be shown while filing IT returns, under section VI A…or in losses[like hsg loan interest is shown]…clarify….or any other section…….
say if actually 2 lakh rupees[or more] are spent in 1 travel, can this much amount be claimed for lta exemption….
@Kumar, max was 20k, last I checked. So unless the rules have changed it should be 20k.
Hi,
I am in HR deptt. Giving exeption to employees this year. I have few questions please answer
1. Upper Limit for LTA claim for one year?
2. Bill are required?
My finance department said there is no upper limit for LTA, should be reasonable and there is no need for bills for claiming LTA. Have a doubt?
Dear Manshu,
I read all the people’s questions and your replies, but still have a doubt in one specific area of ‘break journey’.
I am planning to go from Vadodara to Lucknow next month by flight. But, since there is no direct flight, I have to change planes at New Delhi. Hence, my journey would be Vadodara – New Delhi – Lucknow and back in the same way.
If I am landing in Delhi then, I also want to stay there for a day or two, before flying to Lucknow. This could be either while going or on my return journey or both times too. Now, my HR says I can claim enitre amount from Vadodara to Lucknow flight as it is the shortest route in that mode (by flight). But, they say that if I stay in Delhi and then go to Lucknow after a days’ or more gap, they it will not be considered. In that case they suggest me to claim only for Vadodara – Delhi and Delhi – Vadodara flight expenses for LTA.
My question is that what is the logic of that? Is there any rule or sub-clause in LTA that does not permit this thing? Because, I am anyway going to travel to my final destination (Lucknow) in that same leave period; then why can’t I have a gap of day or two days before going to my final destination? The route will still remain the shortest.
Please clarify me urgently on this as I need to urgently plan and book tickets for this Diwali 2009.
I tried to look up the relevant section but couldn’t find the rule relating to this. I am sorry that I was unable to help you out. Have a happy Diwali, whichever way it turns out though.
Oh.. I wish something could’ve been found out. Anyways, thanks for your effort.
My HR too tried to find some alternative to help me out and just told me this morning, that if I don’t make a long stop-over (except for changing flights) while any one journey, they will pay me full amount for that and for the journey with a Delhi stay, they can pay me for partial tickets, like Delhi to Vadodara only. So, for Lucknow to Delhi I will be paying from my pocket. Not a bad deal, atleast major travel cost is covered.
Request you to let me know here or on my email in case you get any updates on this query just for my future use. Thanks again!
can i claim lta amount before the date journey
Yes the amount can be claimed.
I need clarification on the process to claim LTA for the following scenario.
My employment base location is Pune.
I travelled from Pune to Mumbai by Car.
Availed flight from Mumbai to Kolkata. Stayed in Kolkata for few days.
Travelled from Kolkata to Puri by Train. Stayed at Puri for few days.
Returned from Puri to Kolkata by train. Stayed in Kolkata for a couple of days.
Returned from Kolkata to Mumbai by flight.
Returned to Pune from Mumbai by Car.
Please let me know the best process that will entitle me to claim the maximum from my travel costs.
With Regards
Jay
I need clarification on the process to claim LTA for the following scenario.
My employment base location is Pune.
I travelled from Pune to Mumbai by Car.
Availed flight from Mumbai to Kolkata. Stayed in Kolkata for few days.
Travelled from Kolkata to Puri by Train. Stayed at Puri for few days.
Returned from Puri to Kolkata by train. Stayed in Kolkata for a couple of days.
Returned from Kolkata to Mumbai by flight.
Returned to Pune from Mumbai by Car.
Please let me know the best process that will entitle me to claim the maximum from my travel costs.
With Regards
Jay
Hi Manshu,
Can you tell me whether LTA can be claimed only if the source is where your office location is ? or can be from any where in india i.,e., other place which is neither my native nor where my office is situated ? ( as i am looking to claim from my uncle house to the place where i travelled with my family).
Please send the details to my mail id.
Regards,
vamsi
please send me the details if you have solved your query regarding place of office to be start point of journey to claim LTA
Hi!,
I want to know if I do not take leave for LTA and the same LTA amount is paid to me, so can u advice me that what is the percentage rate charged, as the LTA amount is taxable.
How to use LTA from two companies in same financial year?
I would be leaving my current organization by end of Dec ’09. For the period of April ’09 to Dec ’09, I have received LTA for 30,000.
Also, in the new organization, I would get LTA worth 5,000 for the remaining period of this financial year i.e. Jan ’10 to Apr ’10.
Last month, I went on honeymoon vacation where I have spent around 35,000 for Travel. My current company Finance people say that I can submit the documents worth 30,000 max and not more than that.
Please explain whether I can claim LTA for the entire 35,000. Because, if I combine the LTAs of both the companies, it is 39,000. If possible, what is the procedure?
Also, out of the 4 boarding passes, I have 3 with me but missed the last one. Is it legally required to provide the boarding passes, not just the print out of the e-tickets alone?
Hi,
If I claim LTA more than 2 times in 4 years then what is tax deduction ?
Can I claim LTA if not travled with family ?
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