Salaries-travelling and halting allowance

Save Share

This query is : Resolved

dheeraj (Querist)
Follow

05 March 2012 If an employee goes on an official tour to bombay, And the employer bears the following charges:
1. Conveyance from residence to airport and back.
2. Hotel stay excluding food charges.
3. Flight expenses.
4. And a fixed rate of Travelling/Halting Allowance. The employee doesnot submit any food intake bills. Is this Halting Allowance and Travelling Allowance paid Taxable. Answer me with section no.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
Follow

05 March 2012 Official tour expenses will not taxable in the hands of employee.

Message likes : 1 times

dheeraj

dheeraj (Querist)
Follow

07 March 2012 I want to know the section number and more information regarding the particular case which i have written.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
Follow

22 July 2025 Here’s the detailed tax treatment and relevant sections for Travelling and Halting Allowances paid to employees on official tours:

1. Conveyance from residence to airport and back
If borne by employer for official travel, this is considered a reimbursement of expenses and not taxable in the hands of employee.

Section: Covered under Section 10(14)(ii) as Travelling Allowance (TA) for official tours, exempt to the extent of actual expenditure incurred.

2. Hotel stay (excluding food charges)
Employer-paid hotel stay during official tour is a reimbursement of actual expense and generally not taxable.

It is considered perquisite but exempt as it is for official purposes.

3. Flight expenses
Actual flight fare paid by employer for official travel is not taxable for the employee as it is a business expense/reimbursement.

4. Fixed rate of Travelling/Halting Allowance
Travelling Allowance (TA) and Halting Allowance (also called Daily Allowance) paid as a fixed allowance are taxable unless the employee submits proof of actual expenditure and the allowance does not exceed such expenditure.

If no bills or proofs of expenditure are submitted, the allowance paid is fully taxable as salary income.

Summary of Tax Treatment:
Allowance / Expense Taxability Relevant Section / Rule
Conveyance to/from airport (official) Exempt (reimbursement of actual expense) Section 10(14)(ii), CBDT Circulars
Hotel stay (excluding food) (official) Exempt (reimbursement) Section 10(14)(ii)
Flight expenses (official) Exempt Section 10(14)(ii)
Fixed Travelling/Halting Allowance (no bills) Fully taxable (if no proof of expenditure) Section 10(14)(ii), Rule 2B Income Tax Rules

Reference:
Section 10(14) of Income Tax Act provides exemption for allowances granted to meet expenditure incurred on account of travelling, conveyance, etc., for official purposes.

Rule 2B of Income Tax Rules, 1962: If the allowance is paid without submission of actual bills or proof, it will be treated as taxable income under the head “Salaries”.

In your case:
Conveyance, hotel stay, flight expenses paid by employer — Not taxable.

Fixed travelling/halting allowance without bills — Taxable fully as salary income.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now