ITR Filing: The government is allowing applications for tax exemption in LTA/LTC. Here is the information on how to claim the exemption.
ITR Filing: To revive the tourism sector and consumer spending, the central government had launched the Leisure and Travel Concession (LTC) cash voucher scheme in October 2020. The purpose of LTC vouchers was initially to provide tax exemption to the taxpayers on their travel expenses. However, the second COVID-19 messed up all travel plans. The government decided to extend the LTC tax benefit on the purchase of goods and services to all eligible salaried taxpayers. With the latest amendment in the scheme, the government is allowing salaried employees to apply for tax exemption on purchase of goods and services with LTA/LTC provisions in their salaries. Employees have to submit their purchase bills with their employers. On purchase of such bills, the employer will not deduct the salary of the eligible persons on the basis of LTA/LTC bills submitted by the employees. Employees have to indicate in Form 16 the amount which has already been deducted from their monthly salary.Also Read – Income Tax Refund: CBDT issued tax refund of Rs 70 thousand crore
Important things to know about LTA Voucher exemption in ITR
- In order to get tax return on such purchase, taxpayers need to ensure that the goods or services purchased are at least 3 times the amount applicable for availing tax exemption instead of tax exemption on travel tickets.
- Taxpayers also need to ensure that their purchase of goods or services should be completed online. In addition, individuals will be able to avail tax benefits on transactions between October 2020 and March 31, 2021.
- Another fact that taxpayers should note is that they need to buy those goods and services which attract at least 12% or more GST in order to avail the tax benefits.
- Taxpayers will also have to ensure that the GST number and the amount of GST paid are mentioned in all the bills generated.
Also Read – ITR Filing Alert: After this date, there will be a penalty of Rs 5000 for filing income tax return, fill the return immediately Also Read – Vivad Se Vishwas Yojana: CBDT Extends Payment Deadline Under ‘Vivad Se Vishwas’ Scheme