LTA Exemption
LTA Exemption Can I get tax exemptions for travel expense? Yes, you do get an exemption from tax on the amount that you spend on journeys. Leave travel allowance is an allowance given to an employee to meet the expenses of journeys. LTA exemption can be claimed only for two journeys, in a block of 4 years and is limited to the amount actually spent on journeys.
LTA Exemption To claim this deduction you have to preserve the journey tickets as a proof. Even if you and your spouse undertake more than one journey, you two may claim this deduction with your respective employer for two journeys each in a 4 year block. This ways you can maximize your deduction and reduce tax liability.
LTA Exemption Example: Kunal and his wife Swati travel to Kullu Manali on a vacation in the month of May 2015 spending Rs.15,000 on flight journeys and then again to Kerala in October 2015, spending Rs.20,000 on flight journeys. LTA received by Kunal for the year is Rs.20,000 and by Swati is Rs.10,000. The deduction will be limited to the amount of LTA received or amount spent on journeys whichever is less.
LTA Exemption Continued.. Hence if Kunal claims LTA deduction for Kerala journey then he will get an exemption of Rs.20,000 since he spends Rs.20,000 on his journey. Swati, his wife on the other hand will get an exemption of Rs.10,000 only for the journey made to Kullu Manali since her LTA received is Rs.10,000 even if the amount spent is Rs.15,000.
LTA Exemption Continued.. There is a condition in the IT Act that the amount allowed as exemption will be for the shortest route between the two destinations. Also now that Kunal and Swati have availed of an exemption in 2015 they can claim exemption only once each in the block of 2015 to 2019.
LTA Exemption
Thank You..!! For more info: https://www.hrblock.in/