Submit LTA proofs by March 31 to ensure compliance

Employees who choose the old tax regime must submit their Leave Travel Allowance (LTA) proofs by March 31, 2025. This is important to avoid complications when claiming LTA tax exemption in their income tax returns. The LTA exemption allows salaried employees to claim deductions on travel expenses for journeys within India. However, it does not cover foreign travel. To be eligible for LTA, employees must have it as part of their salary package and must provide proof of their travel expenses. Employees can claim this exemption for two journeys within a four-year block, with the current block running from 2022 to 2025. If an employee misses a claim within this block, they can still claim it for the first journey in the next block. The maximum amount eligible for exemption depends on the LTA amount from the employer, actual expenses, and specific government regulations. For example, if traveling by plane or train, the exemption is limited to either actual costs or the lowest fare allowed by the rules. To claim the LTA exemption, employees need to submit travel documents to their employer, like tickets and invoices. No expenses for local travel or accommodation are included. Employees should check with their employers for submission deadlines and requirements. If employees forget to submit LTA proofs to their employer, they can still claim it in their income tax return. However, the exemption will need to be clearly documented to avoid inquiries from tax authorities. It’s advisable to claim LTA through the employer for a smoother process and to reduce discrepancies in tax filings.