## Leave Travel Concession (LTC) Exemption [Section 10(5)]
LTC reimbursement for travel within India can be exempt, subject to strict conditions. Note: the exemption is available only under the optional (old) tax regime.
### 1. When is it available?
The employee must travel within India:
- (a) while on leave, or
- (b) after retirement, or
- (c) after termination of employment.
### 2. What expenses are covered?
- ✓ Travel expenses of the employee and family — spouse, children, dependent parents, and dependent brothers/sisters.
- ✓ Restricted to a maximum of 2 surviving children if born after 1 October 1998 (no restriction for children born before this date).
- ✗ Boarding and stay expenses are fully taxable if reimbursed — only the journey/travel cost qualifies.
### 3. Quantum & block limits
- Exemption is limited to the amount actually spent on travel, subject to mode-of-travel caps below.
- Allowed for a maximum of 2 journeys in a block of 4 calendar years (blocks running from 1986). Current block: 2022–2025.
- Carry-forward: if no LTC is availed in a block, 1 unused journey can be carried forward and used in the first year of the next block.
### 4. Mode-of-travel ceilings
| Mode | Exemption limit (shortest route) |
|---|---|
| Air | Economy fare of the National Carrier by shortest route |
| Rail available | First-class AC rail fare by shortest route |
| Rail unavailable, recognised public transport exists | First-class / deluxe fare by shortest route |
| Rail unavailable, no public transport | Equivalent first-class AC rail fare for the distance |
### Memory hook
'2 journeys, 2 children, 4-year block' — and remember only travel is exempt, never stay or boarding.