Relocation allowance is taxable?

Originally posted by : Ginu
	Current employer is providing 100000L for relocation/relocation allowance ( i.e transportation and packaging ). Suppose I spent 120000 on actuals. Am I taxable on the amount 100000L received as relocation allowance?  Thanks, Ginu

As per sec.10(14) read with rule 2BB any allowance granted to meet the cost of travel on tour or on transfer shall be exempt from tax to the extent of actual expenses incurred.
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(Allowance granted to meet the cost of travel on transfer includes any sum paid in connection with transfer, packing and transportation of personal effects on such transfer.)
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Accordingly, you could claim the relocation allowance as exempt from tax to the extent of actual expenses incurred.
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The difference, if any, between the amounts reimbursed by the employer and the actual specified expenses incurred by you shall be taxable as salary income in your hands.