K S Prasad (Manager Accounts) (105 Points)
21 April 2010Dear All,
In our Company Leave Travel Allowance is treated as reimbursement and it will be claimed yearly once. Now some of the employees are asking that LTA can be added to thier salary monthly and TDS can be claimed.
As per Income Tax rules this is allowable or not, kindly clarify this quiery as erarly as possible.
Rachit
(Analyst)
(913 Points)
Replied 21 April 2010
Sec 10(5) grants exemption in respect of the value of LTA received by an employee subject to fulfillment of the conditions laid down in Rule 2B.
In case any employee does not want to claim this exemption, the same will be treated as taxable in his hands and requisite TDS shall be deducted accordingly.
Taxable LTA can be paid monthly alongwith salary, subject to deduction of TDS thereupon
CAclubindia
