Section 10(5) → Section 12
Leave Travel Concession (LTC)
Quick Answer
Section 10(5) of the Income Tax Act, 1961 (Leave Travel Concession (LTC)) corresponds to Section 12 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 10(5)
Section 10(5) of the 1961 Act sets out the rules on leave travel concession (LTC). Exempts value of travel concession received by an employee for proceeding on leave to any place in India (2 journeys in a block of 4 years).
The new code maps this to Section 12: the provision is retained and renumbered as Section 12 of the Income-tax Act, 2025, applying from 1st April 2026. Retained but primarily relevant for the Old Tax Regime. Taxpayers opting for the default New Regime (115BAC) cannot claim this.
On the ground, changes to Section 10(5) carry a High impact. Affects salaried employees' tax planning.
Sec 10(5)
Provision Summary
Exempts value of travel concession received by an employee for proceeding on leave to any place in India (2 journeys in a block of 4 years).
Sec 12
Provision Summary
Retained but primarily relevant for the Old Tax Regime. Taxpayers opting for the default New Regime (115BAC) cannot claim this.
Key Changes & Highlights
- Relegated to a non-default option. Block year tracking digitized.
Related Sections
Frequently Asked Questions
What does Section 10(5) of the Income Tax Act 1961 deal with?
Section 10(5) of the Income Tax Act, 1961 covers leave travel concession (LTC). Exempts value of travel concession received by an employee for proceeding on leave to any place in India (2 journeys in a block of 4 years).
Where does Section 10(5) of the ITA 1961 go under the Income-tax Act, 2025?
Section 10(5) of the Income Tax Act, 1961 maps to Section 12 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained but primarily relevant for the Old Tax Regime. Taxpayers opting for the default New Regime (115BAC) cannot claim this.
Why does the change to Section 10(5) matter for taxpayers?
The transition impact for Section 10(5) is rated High. Affects salaried employees' tax planning.
What are the key changes to Section 10(5) under the Income-tax Act, 2025?
Relegated to a non-default option. Block year tracking digitized. These points are specific to Section 10(5) (Leave Travel Concession (LTC)).
Disclaimer: This mapping of Section 10(5) (Leave Travel Concession (LTC)) to Section 12 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 10(5) is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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