Page 77 - DHC Budget Book 2021-22 Final
P. 77
6.6
Exemption for LTC Cash Scheme [Sec. 10(5)] [for AY 2021-22]
Hitherto, Sec. 10(5) provides for exemption
in respect of value of travel concession or assistance received by an employee from
his employer for himself and his family in connection with his proceeding on leave to any place in India.
Government of India vide Office Memorandum dated 12-10-2020 has announced a one-time Leave Travel Concession (‘LTC’) Cash voucher Scheme offering tax exempt of payment of LTC for the block period of 2018-2021 to
CG employees, without the need for them to undertake actual travel, in view of difficulty faced during Covid-19.
Subsequently, vide Press Release dated 29-10- 2020, said benefit has also been extended to private employees.
Key features of such Scheme is as under :-
New Scheme can be opted in lieu of available
LTC in the Block of 2018-21.
Expenditure is incurred by individual or member of his family on goods or services which are liable to GST @ 12% or more.
Expenditure should be incurred during the period 12-10-2020 to 31-03-2021.
Payment should be made by electronic mode.
Amount of exemption shall be lower of H 36,000 per person or one third of such expenditure incurred.
Vide the above amendment, aforesaid scheme has been enacted in the Statute.
Comments:
Aforesaid amendment has been made applicable to AY 2021-22 only and not to any other subsequent year.
The said benefit shall not be available to an individual where two LTC has already been utilised in the block of 2018-21.
Aforesaid benefit cannot be availed by individuals who opt for taxation under new regime u/s 115BAC as benefit u/s 10(5) is not available for such individuals.
Content Tax Provisions Applicable to Non-Corporate Assessee Direct Tax 75
