Leave Travel Allowance Definition

Leave travel allowance, in simpler words, is a type of allowance which is included in an employee''s salary package. It typically covers travel expenses incurred during a leave.

As an HR manager, you might get frequently asked questions and queries by the employees about leave travel allowance or LTA.

LTA, no doubt, forms one of the most essential parts of financial planning for all working professionals, not only because it reimburses their travel expenses but also provides tax benefits. Let''s go ahead and understand everything about LTA so that you don''t delay clearing your employees'' doubts any further.

What is Leave Travel Allowance?

Leave Travel Allowance, normally abbreviated as LTA, is an allowance given to the staff by companies to cover all their expenses regarding any travel. Mostly, once a year, companies provide this allowance to their employees. It is a very important part of an employee''s CTC.

The best part about leave travel allowance is that it is not always taxed. Now that you know what LTA means, let us see who can claim this allowance in the next section.

Who Can Claim Leave Travel Allowance?

Following are a few criteria that would render an employee eligible to claim a leave travel allowance:

• This allowance can be claimed on the actual expense incurred in traveling. Also, the mediums used by the employee for that whole trip, be it by road or by air, are claimed under this allowance. Needless to say, the employee has to necessarily provide the proof of expenses to be able to claim them.
• Only travel expense is reimbursable for an employee. The expenses incurred toward food, housing, and travel are excluded therein.
• The LTA only permits the employee to seek reimbursement related to domestic transport expense.
• It has to be noted that an employee is not entitled to claim LTA at all during a calendar year. The LTA claim can be made for two journeys in a block of four years only.
• As the employee can seek LTA only after their uninterrupted non-attendance to job due to travel, so he/she should state that during the mentioned days he went on leave.

LTA Claim Procedure

Mostly, the procedure to claim LTA is determined by each workplace. Every company has a different deadline. The employers may further request workers to provide proof of their journey in the form of tickets, boarding passes, travel agent invoices, and other such documents while submitting the necessary declaration. This forms the reason why companies tell employees to carry on maintaining a copy with them always of the documents related to their journey.

Mostly, employees just submit travel documents to the respective departments and then do the rest of the process from their end. Claiming and managing LTA is time-consuming as well as tedious in a traditional setup where everything is done manually. Resultantly, companies are shifting to HR software lately to make things super faster and easier.

That is all about leave travel allowance. We hope, with a crystal-clear understanding of this concept, you shall never face any difficulty in addressing employees'' queries related to LTA.

FAQs

• What is the LTA in salary? LTA means leave travel allowance. In most cases, it forms part of the employee''s CTC. In simple terms, LTA will cover the overall expenses that an employee incurs for the work-related trip.
• How is LTA calculated in CTC? Computing LTA, or leave travel allowance in CTC is simple. If an organization gives 30,000 rupees as an LTA to an employee and the actual trip cost is 20,000 rupees, he can claim only 20,000 rupees as an exemption. Rest of the 10,000 rupees will be added to their taxable pay income.
• Is LTA part of CTC? In fact, LTA is a part of your salary; hence, it gets automatically credited to your account whenever you are paid. As long as you don''t travel or have valid proof to show that you did travel, you can''t use the LTA you got to get a tax break.