Taxpayers are allowed to claim one-third of the bill amount as tax-exempt LTC/LTA.
New Delhi. Due to the Corona epidemic, people had to change their travel plans. Employed people could not even take advantage of Leave Travel Allowance (LTA). In view of this, the central government had announced the LTC Cash Voucher scheme last year. According to this announcement, salaried taxpayers can take advantage of this scheme without traveling.
Conditions for availing benefits under the scheme
>> Under this, three times the LTC fare amount will have to be spent on the purchase of those goods and services on which GST is 12 percent or more.
>> This amount should be spent between 12 October 2020 to 31 March 2021.
>> Payment should be done through digital methods like Cheque, UPI, Debit / Credit card etc.
>> The employee has to give the copy of the invoice to his institution.
How to claim in ITR form
Taxpayers are allowed to claim one-third of the bill amount as tax-exempt LTC/LTA. In the LTC cash voucher scheme, bills can be deposited for each member of the family for a maximum of one-third of the amount spent or up to Rs 36,000, whichever is less. If you have submitted bills for this to your employer, then the employer will not have deducted you tax on the amount of LTA/LTC. You will see this amount as a tax exemption in Form 16. It can be claimed under section 10(5) of the Income Tax Act. The amount of tax exemption that the taxpayer is eligible for has to be shown in the exempted income schedule of the ITR form.
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