Leave travel concession

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sakshi (Querist)
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14 February 2014 Is the employee liable to pay tax on LTC received from employer in the very first year of its receipt.

If an employee gets one time leave travel concession of Rs. 100,000/- in January 2013 and gets retire thereafter.

will this amount be taxable in the year of its receipt i.e. F.y. 2012-13 as the block prescribed now ends.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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14 February 2014 it should not be taxable. however the exemption is subject to actual travel expenditure incurred by the assessee.

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sakshi

sakshi (Querist)
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15 February 2014 Thanks Sir..
But what if the employee does not make any journey till march 2013??

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Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 February 2014 then no exemption can be claimed..LTA can be claimed only where actual expenditure is incurred.

sakshi

sakshi (Querist)
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15 February 2014 Thanks again Sir.. but still my doubt is pending..as there is a provision of carry forward also.

receipt of LTC in Jan, 2013
Journey made in May 2014.
Block ends on 2013.
amount to be taxed is...
A.Y. 2013-14 salary(including LTC) ???

Nikhil Kaushik

Nikhil Kaushik (Expert)
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15 February 2014 but isnt your assessee retiring in January?? if he retires that how will he carry it forward?

with regards to carry forward for the people who continue to be in employment, it is the eligibility that is carried forward. what you receive is just an advance, you need to use it within a specific period of time to get the deduction.