LTC CASH VOUCHER
SCHEME
In the wake of coronavirus
pandemic, people are avoiding travel. "Considering this peculiar scenario
and due to the need to boost demand, the government has introduced new LTC
voucher scheme wherein the Central government and its PSUs shall pay to its
employees the maximum amount of LTC that can be availed by such employee, upon
fulfilling certain spending related conditions.
Who are eligible:-
This scheme is basically meant for the employees of the Central government, Public Sector Banks (PSBs) and Public Sector Undertakings (PSUs). However, as per the notification, tax concession will be allowed for state government and private sector employees too who currently are entitled to LTC, subject to the guidelines of the Central government scheme.
Brief note about LTC Cash Voucher:-
Travel by an employee and or his or her family members is one of the
conditions to avail the exemption under LTA/LTC. "Those employees who were
not planning to avail or have not been able to avail of the the LTC owing to
fear of the pandemic, have an opportunity to claim LTC under the new scheme,
which would have otherwise lapsed on March 31, 2021.
This scheme is comprises both LTC / LTA & Leave encashment and both
should be utilized for availing benefits under LTC Cash voucher scheme. If the
employee intends to avail the benefits under the tax concession scheme, the
employee will have to spend three
times of the amount received as LTA and an amount equal to the value of leave encashment.
It must be noted that in order to avail benefit of this package, an employee
should opt for both leave encashment and LTC / LTA fare.
The cash equivalent of entitled LTC fare and leave encashment will be given to the employee if they fulfill the following conditions:
Ø The employee spends an amount equal to the value of three times of the LTC and one time of the leave encashment amount for the purpose of purchasing non-food items i.e. white goods.
Ø The item purchase or services availed shall carry a GST Rates not less than 12%.
Ø Such purchase shall be from GST registered vendors or service providers through digital mode.
Ø The employee shall obtain a voucher indicating the GST number and the amount of GST paid.
Ø The money on
goods/services must be spent before March 31, 2021.
The deemed LTC fare
for Central Govt Employees for this purpose is as follows:
1) Employees who are entitled to
business class of airfare: ₹36,000 (per person
Round Trip)
2) Employees who are entitled to economy
class of airfare: ₹20,000 (per person Round
Trip)
3) Employees who are entitled to Rail of
any class: ₹6000 (per person Round Trip)
Computation of Special Package – LTC Cash Voucher:
Particulars |
Reference |
Amount |
Final Amount |
|
Leave Encashment (10 Days) |
|
25000 |
25000 |
A |
Fare Denoted for LTC as per the
notification based on the employment category |
|
20000 |
|
|
Self + Family Members |
1 + 3 = 4 |
|
80000 |
B |
|
|
|
|
|
Amount to be spend by Employee |
|
|
|
|
3 Times of LTC Eligibity |
|
|
240000 |
C = B * 3 |
1 Time of LE Eligibility |
|
|
25000 |
A |
|
|
|
|
|
Total Spending should be done |
|
|
265000 |
D = A + C |
|
|
|
|
|
Tax Exemption for the actual eligible amount / Total
Eligible Cash reimbursement |
|
|
105000 |
E = A + B |
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