Leave Travel Allowance (LTA) and Leave Travel Concession (LTC)
LTC / LTA are for all those Employees who wish to travel under the scheme of Leave Travel Concession (LTC) / Leave Travel Allowance (LTA) by himself/herself or by members of his/her family covering comprehensive lists of tourist destinations in India and abroad depending on the selection of places of their choice.
10 MUST know about LTA: Leave Travel Allowance affects every salaried employee. Here is a quick low-down on what to expect:
1. You can get LTA only if you have applied for leave from your company and have actually travelled. However, international travel is not valid. You must have travelled within the country.
2. The entire cost of the holiday is not covered. Only the travel costs are covered. So, whether you fly, hop on to a train or take public transport, you will have to show the ticket to claim your LTA. This means you will need to keep your air, rail or public transport ticket.
3. If you travel by car and it is owned by a central government organization like ITDC, the state government or the local body, then LTA is permitted.
If you could not get public transport and resorted to private transport like renting a car, get a bill issued by the rental company. If the bill is not accepted by your employer, you can always file an income tax return, claim an exemption and get a refund.
4. LTA covers travel for yourself and your family. Family, in this case, includes yourself, parents, siblings dependent on you, spouse (even if your spouse is working) and children. For children born after October 1, 1998, the exemption is restricted to only two surviving children (unless, of course, one birth has resulted in multiple children like twins and triplets). If your family travels without you, no LTA can be claimed. You have to make the trip, either by yourself or, if claiming for your family, you should travel with them.
5. LTA is not related to when you started your employment. The government fixes blocks of years. These blocks are not financial years (April 1 to March 31); they are calendar years (January 1 to December 31). The current block is 2006-09 — January 2006 to December 2009. The earlier one was from 2002-05 — January 2002 to December 2005. During this time period, a person is entitled to two LTA claims.
6. Though you can claim two journeys in a block of four years, you can claim the LTA benefit just once in a year. You cannot claim both the journeys in one year. So, while a person can get an income tax exemption for two journeys in a block of four calendar years, he can make a trip only once a year. If you make two trips in a year, you lose one. One way out is to claim one and make your spouse claim the other.
7. You can carry forward your LTA. One LTA can be brought forward and claimed in the first year of the next block. Let’s say you do not take your LTA in 2002-05. Or that you use only one LTA. Don’t worry; you will be able to take the pending LTA in 2006. This means that, in the 2006-09 blocks, you will be totally entitled to the three journeys.
8. If you switch jobs, you can get the LTA not only from your present organization but also from your former employer, if the concession is lying unutilized.
Let’s say that, in the 2002-05 block, you claimed LTA/LTC in 2003. In 2004, you switched jobs. You can still claim your second journey with your new employer. Of course, your new employer will ask to look at your earlier tax returns to see whether it has been claimed or not.
9. You must take the shortest route to your destination to be eligible for LTA. Let’s say you are going from Delhi to Mumbai on a holiday. So the cost of your travel from Delhi to Mumbai and Mumbai to Delhi will be eligible for LTA. If you decide to go to Mumbai via Agra, Jhansi and Itarsi, your LTA from Delhi to Agra will be covered. But Agra to Mumbai will not be covered. Let’s take another scenario. You travelled from Mumbai — Kerala — Delhi — Mumbai. If you take a direct connection, you will be eligible for LTA. Mumbai — Kerala — Delhi — Mumbai: LTA covered. But if you throw in Hyderabad, then it goes out of gear. Mumbai — Thiruvananthapuram: LTA covered. Thiruvananthapuram — Hyderabad — Delhi: LTA not covered Delhi — Mumbai: LTA covered.
10. If your LTA is not utilized, it gets added to your salary and you will be taxed on it. Let’s say you and your spouse are both employed and both have LTA as part of the salary package. Your LTA is Rs 20,000 and hers is Rs 20,000 too. Both of you and your child go for a holiday. The tickets for the three of you amount to Rs 15,000. You supply the tickets to your office and this amount will be eligible for a tax deduction; the balance Rs 5,000 will be taxed. You can claim exemption only to the tune of your expenditure. If you claim this, your spouse will not be able to claim this same holiday from her employer. His/ Her Rs 20,000 will be taxed. Unless, of course, you go for another holiday and he/ she claims it. Or, let’s say, you spend Rs 30,000 on tickets but your LTA is just Rs 20,000. You can claim up to Rs 20,000 and tell your spouse to claim his/ her ticket from his/ her employer.
LTC is different from LTA in LTC some part of the Travel Concession will be given by company and the balance is bared by the individual, it also depends upon the company policy.
Any employee with one year of continuous services on the date of Journey performed by him/his family is eligible. For e.g. an official appointed on 31-12-2008 will be eligible for the two year block 2008-09, but those appointed on or after 01-01-2009 will not be eligible for that block. Government Servants whose spouses are working in Indian railways, National Airlines are not eligible for LTC and if an official is under suspension, his family members only can avail LTC.
When both the husband and wife are Central Government Servants then:
They can claim LTC for their respective families. e.g.: while the husband can claim for his parents/ minor brothers/ sisters, the wife can avail for her parents/ miner brother/sisters. The husband / wife who avails LTC as a member of the family of the spouse, cannot claim independently for self. They can declare separate Home towns independently.
Salient Points regarding LTC
1. Concession can be availed of for self and family members separately on different occasions, even in different calendar years of the same block.
2. Family can travel in one or more groups; but each group should complete its return journey within six months from the date of its outward journey.
3. Circular tour tickets can be availed of in conjunction with the concession.
4. Can be availed of during any leave including study leave, casual leave and special casual leave.
5. It can be combined with transfer/tour.
6. Cannot avail of during closed holidays only without taking the leave.
Entitlements for LTC
1. Journey by Air/Rail/Steamer: Entitled officers and their family members can travel by any air India only.
2. Journey by Road: Entitles will be the same as for tour / transfer. Reimbursement admissible only in respect of journeys performed in vehicles operated by the government of any corporation in the public sector run by the central or state government or a local body.
When journey is performed by a longer route (not the cheapest route) in tow different classes of rail accommodation, the entitled class rate will be admissible for the corresponding proportion of the shortest/cheapest route and the lower class rate for the remaining mileage by such route. Where journey is performed by a longer route respect of journey performed by rail and for the remaining shortest distance, as per entitlement by rail or the actual fare paid for the journey by road, whichever is less.
Reimbursement in the case of LTC:
Fares for journeys between duty station and Home town, both ways will be reimbursed by the government in full. If the employee and family reside away from the duty station, fares for journeys between place of residence and home town, both ways, restricted to that from duty station to reimbursable.
Up to 90% fares can be taken. Advance admissible for both outward and return journey if the leave taken by the official or the anticipated absence of members of family does not exceed 90 days. Otherwise, advance may be drawn for the outward journey only.
The official should furnish Railway ticket numbers, PNR No, etc to the competent authority within ten days of the drawl of the advance.
When advance is taken claim should be submitted within three months from the date of return journey. If not outstanding amount will be recovered in one lump sum and claim will be treated as one where the advance is sanctioned. When the claim is submitted within stipulated time but unutilized portion of advance not refunded, interest is chargeable on that amount from the date of drawls to the date of recovery.
When no advance is taken, claim should be submitted within six months from the competition of return journey. Otherwise the claim will be forfeited.
LTC to Home Town:
LTC to home town is admissible to all employees irrespective of distance involved. Home town once declared is treated as final. In exceptional circumstances the Head of the Department may authorize a change, only once during entire service.
Encashment of Earned Leave (EL) during LTC:
It will be admissible subject to the following conditions:-
It is limited to 10 days of earned leave on one occasion without linkage to the number of days and nature of leave availed and 60 days in the entire career.
Will not be deducted while computing the maximum admissible for encashment at the time of quitting service.
The balance at credit should not be less that 30 days after deducting the total of leave, if any availed plus leave for which encashment was availed.
Where both husband and wife are Government Servants, encashment of leave will continue to be available to both subject to maximum limit of 60 days to each of them.
The Central government has extended by two more years its scheme of relaxation of LTC rules allowing its employees to travel to the North-eastern region.
The Department of Personal and Training issued a notice pertaining to the extension of Leave Travel Concession in view of the enthusiasm generated among the Central government employees resulting in a very large number of families visiting the region in the past 20 months. Union Minister of Development of North Eastern Region Bijoy Krishna Handique also had taken up the issue with Minister of State for Personnel Prithviraj Chavan to extend the facilities which started about two years ago.
The extension is expected to give necessary fillip to the tourism potential of the Northeast and its economy. According to available data, the inflow of domestic tourists to the eight states of the region recorded a growth of 21 per cent in the past two years. 2009 saw a growth of 11 per cent in the inflow of domestic tourists over the previous year. This growth is chiefly attributed to the huge increase in LTC tourists since introduction of the scheme initiated by the Ministry of DoNER with effect from May, 2008. There was a total domestic inflow of 5.7 million tourists in 2009.
Latest Guidelines on Air Travel on Tours/LTC.
This Department is receiving repeated references seeking clarifications with regard to purchase of Air tickets through authorized agents and relaxation for travel by Airlines other than Indian Airlines. The following guidelines may be noted for compliance:
1. On Official Tours:
(i) For travel by Airlines other than Air India because of operational or other reasons or on account of non-availability of Air India flights. Individual cases for relaxation to be referred to M/o Civil Aviation, as stated in this Ministry’s OM No. 19024/1/2009-E.IV dated 13.07.09.
(ii) Air Tickets may be purchased directly from Airlines (at Booking counters/Website of Airlines) or by utilizing the services of Authorized Travel Agents viz. M/s Balmer Lawrie & Company, M/s Ashok Travels & Tours.
(i) Travel by Air India only.
(ii) In Economy class only, irrespective of entitlement.
(iii) LTC-80 ticket of Air India only to be purchased.
(iv) Air Tickets may be purchased directly from Airlines (at Booking counters/Website of Airlines) or by utilizing the services of Authorized Travel Agents viz. M/s Balmer Lawrie & Company, M/s Ashok Travels & Tours and IRCTC (to the extent IRCTC is authorized as per DoP&T OM No. 31011/6/2002-Estt.(A) dt. 02.12.09).
3. LTC for J&K:
(i) Relaxation to travel by Private Airlines to visit J&K while availing LTC is available to all the categories of Govt. employees, including those entitled to travel by Air [DoP&T OMs No. 31011/2/2003-Estt.(A-IV) dated 18.06.10 and 05.08.10 refer].
(ii) For purchase of Air tickets, however, the procedure as given under para 2 (iv) above should be followed.
4. All Ministries/Departments of Govt. of India are requested to strictly adhere to these instructions.