Money Teaser #6: Funny thoughts about LTA

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Last night I lay in bed looking up at the stars in the sky, and I thought to myself, "where the heck is the ceiling?"

—Scott Adams (Dilbert)


The MQ Money Teaser #6 is about the various questions you think about while trying to understand and navigate your way through the complex maze of tax provisions concerning the claiming of LTA / LTC from your employer. There are too many misgivings about the mysterious tax regulations regarding filing a claim for Leave Travel Concession / Allowance. So this money teaser should resolve all your LTA / LTC tax exemptions queries:

LTA / LTC: FAQs

1. Why only travel expenses are allowed for LTA tax exemption? Why hotel stay expenses are not covered?
By implication, there is no need to stay; come back the same day. Anyway, if you would really like to stay and tour the place, there areDharamshalas

Idiotic Tax Advice: A Few Examples

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Beware of false knowledge; it is more dangerous than ignorance.

_George Bernard Shaw

Sometime back, I came across a regular ‘Expert View Column’ in the print media (special supplement to a well reputed National Publication read and relied upon by millions of readers) where experts chosen from different fields answer the questions raised by readers. Here are two tax questions—tax exemption of LTA and tax benefits on home loans— taken from two different editions of the publication:


Query: My Company contends that I must take privilege leave to claim LTA. Is it necessary to take privilege leave for claiming LTA?

Tax Expert view: The tax law has not prescribed the minimum number of days’ leave that should be availed for claiming LTA exemption. Therefore, in my view, even one day’s leave will suffice for claiming LTA exemption.

So what’s wrong with the advice? It is yet

Tax Calculator: FY 2010-11 (PY 2010-2011)

Photo by Dave Dugdale

Budget 2010 has made significant changes in the tax slabs and has also introduced section 80CCF for claiming deduction up to a maximum amount of Rs 20,000 by investing in infrastructure bonds. This is in addition to section 80C limit. Hence, your tax liability stands reduced up to a maximum of Rs 57,680 as compared to tax outgo for FY 2009-2010. Accordingly, I’ve revised the income tax calculator for FY-2009-10 by incorporating the above changes. Here’s the new tax calculator