Coveyance allowance exemption

Dear Abhi!

As per Section 10(14) read with Rule 2BB of the Income Tax Act/Rules, Conveyance allowance granted to meet the expenditure on travel for the performance of official duties is totally exempt.

As per Section 10(14) read with Rule 2BB of the Income Tax Act/Rules, transport allowance granted to an employee to meet his expenditure for the purpose of commuting between the place of his residence and the place of his duty is exempt to the extent of Rs. 800 per month.

However, in your case, it appears that vehicle facility is provided for commuting to home, is provided for a fee by the employer himself. Therefore, any conveyance allowance if granted for this purpose under these circumstances would be fully taxable. If it is for performing offcial duties, you can have recourse to the total exemption provided under Section 10(14).

Good Bye! Cheers!!