LTA

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 For Your Information:

Only 2 journeys in block of 4 years is Exempt –
Exemption is available in respect of 2 journeys performed in a block of four calendar years commencing from 1986.
Different blocks are :
a.       1998-2001 (i.e. January 1, 1998 to December 31, 2001);
b.      2002-2005 (i.e. January 1, 2002 to December 31, 2005);
c.       2006-2009 (i.e. January 1, 2006 to December 31, 2009);
d.      2010-2013 (i.e. January 1, 2010 to December 31, 2013);
e.      2014-2017 (i.e. January 1, 2014 to December 31, 2017);

“Carry over” concession –
If an assessee has not availed travel concession or assistance during any of the specified four-year block periods on one of the two permitted occasions (or on both occasions),
Exemption can be claimed in the first calendar year of the next block (but in respect of only one journey). This is known as “Carry over concession”.
In such case, the exemption so availed will not be counted for the purpose of claiming the future exemptions allowable in respect of 2 journeys in the subsequent block.

Example –
For the Block 2010-2013 Mr X can claim exemption In respect of LTC under sec 10(5) on two occasions. X has availed the exemption only on one occasion (or  he has not availed the exemption at all) during 2010-2013, then he can take the benefit of “Carry over” concession, the benefit of carryover is available only in respect of one journey provided he avails LTC exemption under sec 10(5) in the first calendar year of the next block (i.e. during the calendar year 2014).
In addition, he can avail exemption on two more occasions during 2014-2017.

Other Information

Travel Limitations:
Given below are the travel limitations applicable under Leave Travel Allowance.
·         Leave Travel Allowance covers only domestic travel and does not cover international travel
·         The mode of travel should be either air travel, railway or public mode of transport

LTA Restrictions:
There are certain restrictions when it comes to Leave Travel Allowance. Given below are the important restrictions applicable on Leave Travel Allowance.
·         The Leave Travel Allowance is applicable only for travel expenses
·         The individual can travel only with India
·         The individual has to keep proof of travel as it can be required for tax auditing purposes
·         The exemption under Leave Travel Allowance is not available for more than two children born after October 1, 1998
·         One can claim LTA only twice in a block of four years
·         If LTA isn’t claimed in a particular block, it can be carried over to the next block and used in the first year of the next block itself.

·         LTA exemption offers cover for the family of the individual too. A family, under LTA, includes immediate family which is the parents, siblings, spouse, and children.

LTA rules for a working couple

This gets a bit interesting. If both the spouses are working, who can claim LTA and to what amount ?
Again the rules state that both can claim LTA. So for a working couple, we are talking about 4 LTA claims in a block of 4 years. Needless to say, both cannot claim for the same journey.
But if you observe, they can travel in each year and don’t have to worry about travelling once each 2 years.
If planned well, a working couple can actually enjoy their holidays and reduce their taxable income each year.
Contact at Finotree
- 9762322385

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