Leave Travel Allowance exemption depends on domestic travel, actual expenditure, prescribed fare limits, and the block-based journey restriction.

Leave Travel Allowance is exempt from inclusion in total income when received for travel within India, subject to prescribed conditions, actual travel expenditure limits, mode-wise fare restrictions, and a two-journey block rule. The exemption covers the employee and specified family members, allows carry forward of one unutilised journey into the next block, and requires supporting documentation in Form No. 124. The earlier regime also confined the exemption to domestic travel and actual travel cost.

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