16 December 2008
Hello Expert, Th organisation pays Rs 650/month as Leave travel allowance to the employee and is included for calculation of tax for salary income. What is the maximum LTA exemption to be availed by the employee from income tax? Can the employer allow the exemption and reduce from TDS. Will it be included in Form 16 issued by employer in this case? Thanks
16 December 2008
LTC (Sec. 10(5) - There is no limit on the exemption amount. Exemption amount is the actual expenditure incurred by the assessee and exemption cannot exceed the LTC amount (650x12=7800 in your case).
Second only 2 journeys in block of 4 years are exempt.
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