transport expenses
This query is : Resolved
07 February 2011
Dear Sir,
Please help me out with this issue. If an employee gets Rs. 6000 for transportation from office to residence how can it be non taxable. It is something about section 2BB. Please help me out. Regards Richa
Please help me out with this issue. If an employee gets Rs. 6000 for transportation from office to residence how can it be non taxable. It is something about section 2BB. Please help me out. Regards Richa
07 February 2011
Transport allowances grated to an employee to meet expenditure for the purpose of commuting between place of his residence and the place of his duty is exempted u/s 10(16) of the I.T Act to the extent of Rs.800 P.M.
08 February 2011
thank u sir
i had the same information but one of my reletive has received an amount of Rs. 6000 and fully is exempted.....
is there any other clause or act which exempts transport expenses....
i had the same information but one of my reletive has received an amount of Rs. 6000 and fully is exempted.....
is there any other clause or act which exempts transport expenses....
08 February 2011
You haven't mentioned that the allowances being shown are per month or per annum.
Similar confusion is possible in the case of your relative.
Similar confusion is possible in the case of your relative.
02 August 2025
Got it! Here’s a clear summary for you about transport allowance exemption under Income Tax:
---
### Transport Allowance under Section 10(16) of the Income Tax Act
* **What is exempt?**
Transport allowance paid to an employee for commuting between residence and workplace is exempt from tax **up to Rs. 800 per month** (i.e., Rs. 9,600 per year).
* **If transport allowance is Rs. 6,000 per month**, then only **Rs. 800 per month** is exempt, and the **balance Rs. 5,200 per month is taxable** as salary income.
* **Why would someone get full exemption on Rs. 6,000?**
This might happen only if:
* The employee is differently-abled and entitled to full exemption under special provisions, OR
* The amount is reimbursed (not an allowance), and proper bills or proofs of expenditure are submitted by the employee to the employer. Reimbursements backed by bills are usually non-taxable.
* **Transport allowance as reimbursement:**
If the amount is paid as an **actual reimbursement against bills** for transport (e.g., taxi receipts), it is usually not taxable, irrespective of the amount.
---
### Key points to check:
* Is the Rs. 6,000 being given as a **fixed monthly allowance** or as **reimbursement of actual expenses?**
* Is the employee differently-abled?
* Is the allowance supported by actual transport bills?
---
If your relative is getting Rs. 6,000 **fully exempted**, most likely it’s either reimbursement of expenses or special exemption (like for disability). Otherwise, under normal rules, only Rs. 800 per month is exempt.
---
If you want, I can help you draft a more detailed explanation or help check any notifications or circulars for specific cases. Just ask!
---
### Transport Allowance under Section 10(16) of the Income Tax Act
* **What is exempt?**
Transport allowance paid to an employee for commuting between residence and workplace is exempt from tax **up to Rs. 800 per month** (i.e., Rs. 9,600 per year).
* **If transport allowance is Rs. 6,000 per month**, then only **Rs. 800 per month** is exempt, and the **balance Rs. 5,200 per month is taxable** as salary income.
* **Why would someone get full exemption on Rs. 6,000?**
This might happen only if:
* The employee is differently-abled and entitled to full exemption under special provisions, OR
* The amount is reimbursed (not an allowance), and proper bills or proofs of expenditure are submitted by the employee to the employer. Reimbursements backed by bills are usually non-taxable.
* **Transport allowance as reimbursement:**
If the amount is paid as an **actual reimbursement against bills** for transport (e.g., taxi receipts), it is usually not taxable, irrespective of the amount.
---
### Key points to check:
* Is the Rs. 6,000 being given as a **fixed monthly allowance** or as **reimbursement of actual expenses?**
* Is the employee differently-abled?
* Is the allowance supported by actual transport bills?
---
If your relative is getting Rs. 6,000 **fully exempted**, most likely it’s either reimbursement of expenses or special exemption (like for disability). Otherwise, under normal rules, only Rs. 800 per month is exempt.
---
If you want, I can help you draft a more detailed explanation or help check any notifications or circulars for specific cases. Just ask!
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