Lta taxable

This query is : Resolved

Pradeep Tiwari (Querist)
Follow

01 October 2013 sir

If an employer paying LTA every year to his emplyee with submission of supports. can the employer use exemption of LTA at every alternate year (means one year tax and next year exemption)instead of using block of year cluase. Request clear advise.

Thanks

@VaibhavJ

@VaibhavJ (Expert)
Follow

02 October 2013 Hi

Yes, however since exemption is available twice in a block of four years, the year in which it is paid as taxable no bills are required to collect.

Thanks!!

Pradeep Tiwari

Pradeep Tiwari (Querist)
Follow

02 October 2013 Yes, but we are paying LTA every year and getting supporting docs as a procedure. Therefore if we are taxing LTA at every alternate year(once in two FY). Is it correct?

Thanks

Upgrade to CAclubindia Pro. Subscribe Now!

@VaibhavJ

@VaibhavJ (Expert)
Follow

02 October 2013 That is correct.

But my suggestion is if you are taxing LTA then no need to collect Bills.

Coz, Reimbursement is taxable when Bills are not produced/submitted, So there is no point in collecting bills also & taxing it.

Thanks!!