Quick Summary
A report has appeared in the Economic Times Markets (ETMarkets.com) which gives the impression that the LTC voucher scheme for Government employees may not be attractive. Unfortunately, the piece which it relies on has a serious factual error in its understanding of how Government LTC works. It is based on the erroneous assumption that leave travel money can be retained by paying income tax without travelling.The key assumption in the report claims: They would be better off paying taxes on th
Daily Limit Reached
You have reached your daily limit of 2 Free News
Subscribe to CCI PRO for unlimited access
Why Upgrade to CCI PRO?
- No Ads
- WhatsApp Community
- Daily E-Newsletter
- Unlimited News Access
- Profile Visitors
- Link Social Profiles
- Featured Job Posts
- Pro Badge
- Expert GST Guidance
- Unlimited Forum Replies
- Download Content in PDF
1 Year PLAN
1999
(Excl. of GST ₹359)
2 Years PLAN
3499
(Excl. of GST ₹629)
BEST VALUE
3 Years PLAN
4999
(Excl. of GST ₹899)
View all CCI PRO benefits
Already a PRO member? Login here for an ad-free experience. 07941056694
FAQ :
The Ministry of Finance is clarifying the Leave Travel Concession (LTC) voucher scheme to correct a misinterpretation that suggested it might not be attractive to government employees.
The report was based on the incorrect assumption that government employees could keep LTC money by paying income tax on it, without actually travelling.
No, government employees are only eligible for LTC if they actually travel. If they do not travel, the amount is deducted from their pay, and they may face disciplinary action.
Previously, employees had only two options: travel and spend the money, or forgo the entitlement if not claimed within the specified date.
A new option allows employees to spend the LTC money on items other than travel, which is particularly relevant given health risks associated with travel during the Covid-19 pandemic.
Yes, the entitlements under the scheme have been calculated at full cost, which includes the Goods and Services Tax (GST) element in fares.
CAclubindia
