Claiming LTA Exemption? Here's Why You Should Submit Proof To Employer By March 31

LTA (Leave Travel Allowance) exemption is a tax benefit provided by the Income Tax Act, which allows individuals to claim exemptions on the expenses incurred during domestic travel. However, to avail of this exemption, individuals need to provide proof of travel to their employer. This proof typically includes travel tickets, boarding passes, and other related documents.

What Is LTA?

LTA or Leave Travel Allowance is a tax benefit offered by employers to help employees save on taxes related to travel expenses during their leave.

The deadline to submit LTA proofs to your employer to claim the tax exemption is typically March 31st. Missing this deadline can mean you lose out on the tax benefit and have to claim LTA while filing your Income Tax Return (ITR), which can be more cumbersome.

While it’s true that claiming LTA exemption in your ITR can be a hassle, providing the necessary proof to your employer within the stipulated deadline is essential to avail of the exemption. If you miss the deadline, you may not be able to claim the exemption for that particular financial year.

To make the process smoother, it’s advisable to keep track of your travel expenses throughout the year and ensure you retain all relevant documents. This will make it easier to compile the necessary proofs when submitting them to your employer.

Here’s a quick breakdown of LTA exemption:

• Benefit: You can claim tax exemption on travel expenses for up to two journeys within a block of four years (current block: 2022-2025). This applies to travel expenses of yourself and your family (spouse, children, dependent parents and siblings).
• Exemption Limit: Only the actual travel cost (flight, train, bus tickets) is exempt, not expenses like food, accommodation, or local travel.
• Proofs Required: Submit documents like travel tickets, boarding passes, or hotel bills (if opting for LTC) to your employer by the deadline.

By submitting proofs to your employer, they can exclude the exempt amount from your taxable income. This saves you the hassle of claiming LTA while filing ITR.