janakiramg (officer) (67 Points)
20 November 2013As per policy of our company (PSU), Development Officers are entitled to get incentive based on targets which include conveyance allowance also. Conveyance allowance( in the form of incentive) is workedout based on his performance ie more business, more conveyance allowance. Ofcourse, concerned officer naturally has to spend more on conveyance expenses to procure more business. Kindly clarify whether conveyance allowance paid is allowed as exemption under Income Tax.
Mihir
(Wealth Manager)
(5293 Points)
Replied 20 November 2013
There are two types of conveyance allowance
1) Conveyance allowance for travelling to office and back home, which is exempt upto Rs.800/- pm.
2) Conveyance allowance for travelling wholly for the purpose of office work, which is fully exempt because it is more like a reimbursement wherein bills will have to be produced and attached with the voucher for expenses incurred in travelling to do office work.
CA D.C. Bansal
(Accounts Head)
(283 Points)
Replied 20 November 2013
Komal Sharma
(Assistant Accountant)
(1887 Points)
Replied 20 November 2013
Agreed With Mihir Sir....
Conveyance allowance is exempt upto Rupees 800/-pm and reimbursement of Conveyance expenses is fully exempt upto the amount spend on conveyance expenses paid for performance of official duty.
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