How do I claim my LTC cash package?

To claim the benefit under the scheme, an individual is required to fulfil the following conditions: i) Spend three times the amount of deemed LTC fare on the purchase of goods/services attracting GST of 12\% or more; ii) Purchases must be made during the period between October 12, 2020 and March 31, 2021.

What is special cash package in lieu of LTC?

The Special Cash Package Scheme in lieu of one LTC is to compensate and incentivize consumption by Government Employees and the benefits can be availed up to 31.03. 2021. The LTC cash voucher scheme circular dated 12.10. 2020 provides for advance to Government employees in lieu of LTC fare and Leave encashment.

Is special cash package in lieu of LTC taxable?

If you have submitted eligible bills to your employer, then the employer should not have deducted tax on the amount paid to you from your LTA/LTC against those bills. Bangar says, “Tax exemption under LTA Cash Voucher scheme will be claimed under section 10(5) of the Income-tax Act, 1961.

What can be claimed in LTC cash voucher scheme?

The LTC Cash Voucher Scheme is a replacement for the original leave and travel concession to employees in a year. It comprises of two parts – leave encashment and travel allowance. The scheme enables employees to claim tax exemption on leave encashment and travel allowance by fulfilling other conditions.

Is special cash package taxable?

The exemption is allowed where an employee takes leave to travel within India and furnishes evidence for the same, subject to fulfillment of conditions prescribed in the Act. In case the proof for travel is not produced, such an amount is then considered as taxable perquisites subject to TDS (tax deduction at source).

Where can I spend LTA money to claim exemption?

In order to claim the benefit under the LTA cash voucher scheme, the taxpayer or his/ her family member should have spent on the purchase of goods and services with a GST rate of 12 or more per cent.

Is leave encashment necessary for LTC cash voucher?

Leave encashment is optional. If an employee opts for only deemed LTC fare without the leave encashment and spends less than three times of the deemed fare as has been prescribed to claim reimbursement of the deemed LTC fare, how the reimbursement would be calculated.

Can I claim LTC while filing returns?

Travel restrictions imposed across the country due to the Covid-19 pandemic made the government announce the LTC Cash Voucher scheme in October 2020. As per chartered accountants, the Income-tax Act, 1961 is silent on whether the tax-exemption on LTC Cash Voucher Scheme can be claimed at the time of filing ITR.