On my offer letter LTA is eligible every year and suddenly HR said it can only be claimed once in 2 years

On my offer letter, LTA is eligible every year, but suddenly HR said it can only be claimed once in 2 years. What arguments can I give in my support?

On my offer letter, LTA is eligible every year, and suddenly HR writes a mail stating it can only be claimed once in 2 years. What arguments can I give in my support? Do advise as well if the company can change their rules as and when desired by them and forfeit the earlier commitments given to employees.

In situations like this, it is important to carefully review the terms of your offer letter and any related policies that may govern LTA eligibility. If there seems to be a discrepancy, you can politely bring this to the attention of HR and seek clarification on the matter. It may be helpful to highlight any specific language in your offer letter that supports your understanding of the LTA policy.

Regarding the company's ability to change rules and commitments, it typically depends on the language in the employment contract and any applicable laws or regulations. If you believe that changes are being made unfairly or without proper communication, you can consider discussing your concerns with HR or seeking advice from a legal professional to understand your rights in this situation.

Dear Friend,

Don't be in a hurry. First of all, have a word with the concerned person and find out. If I am not wrong, they may be trying to add some benefit to you because as per the Income Tax rules, if you avail LTA every year, one year's amount is taxable every two years. Hence, it is better to avail it once every two years so that you can get tax exemption. They may be changing the rules with the right intention.

Thanks and regards,
Kamesh

I have had a word with the HR. The simplest of answers given is that the directors feel that today a person might be working with us, but what if he/she leaves after completion of 1 year of service? In lieu of that case, they will not be paying the LTA to an employee leaving the job. So now, please advise what arguments can be given so that timely LTA, as per the appointment letter, can be availed every year. Out here, tax is not the issue, but getting the rightful dues is the criterion.

If LTA is part of the CTC, the employee should be paid once in a year. However, for tax exemption, he/she can avail the LTA twice in a block year of 4 years subject to the production of travel proof.

Pon

Going by the inputs given by you, what your management has done is not fair and professional. They should have thought of all possibilities at the time of forming any rule or policy. These kinds of afterthoughts and resultant changes in policies show management and its professional abilities in poor light.

There are ways of mitigating the risks of overpayment of annual benefits in case of employees leaving in-between. Assuming annual LTA payable is Rs. 10000, then your LTA Rule can mention that, in the event of an employee leaving the company before completion of the year, LTA claimed and paid will be recovered on a pro-rated basis from f & f. OR LTA will be paid on the completion of the year, so there is no question of any recovery.

Under the circumstances, you can lodge a protest and demand that whatever is committed in the offer or appointment letter should be honored. If not honored, it is nothing but cheating.

I have had a word with the HR; the simplest of answers given is that the directors feel that today a person might be working with us, but what if he/she leaves after completion of 1 year of service. In lieu of that case, they will not be paying any LTA to an employee leaving the job. So now please advise on what arguments can be given so that timely LTA as per the appointment letter can be availed every year. Out here, tax is not the issue, but getting the rightful dues is the criteria.

Dear members,

Can you please explain to me what LTA is and how it is helpful for tax exemption?

Regards,
Mili

Dear Mili,

LTA stands for Leave Transport Allowance, which is part of CTC and equals the basic of your salary. Now, it is up to the employee whether they want to avail it yearly or in a block of 2 years. If the employee avails the LTA once every 2 years, then that amount will be tax-free. If the employee avails the LTA every year, then that amount will be taxable.

Dear Talwarg,

All the answers you have received are from senior HR professionals. A two-year LTA amount is not taxable, which is nowhere a benefit of the company but is instead benefiting you. Go ahead with whatever has been told to you; it's totally in your favor.

Best of Luck.

Thanks and Regards,

Ravibhushan Pandav
9970967623

Dear All,

Thank you, Kamlesh, Pon, and Vivek, for your valuable suggestions.

LTA, i.e., Leave Travel Allowance, is provided by the organization where the person is employed. The LTA is not taxable twice in a block of four calendar years (Jan-Dec, etc.) based on actual spending. The journey can be taken to any place within India by road, rail, or air (economy class only). Any claims exceeding twice in a block of 4 years are taxable. The amount of travel allowance provided by the organization depends on the position and CTC of the employee. Generally, organizations provide LTA to the employee, their spouse, and up to 2 children. This provision depends on the HR policy of the organization where the employee is working.

Thanks & Regards, Vikas Ranjan