UBS

Conveyance Allowance

What is Conveyance Allowance?

Conveyance Allowance is also known as Transport Allowance. This allowance is offered by the company to employees as compensation for the value of traveling from residence to and from the office. This allowance is an addition to the basic salary. Mostly it is tax-free, however, it may or may not be taxed under the Income Tax Act.

Conveyance allowance is up to Rs. 1600 per month and any amount paid over this limit is taxable. The exemption is often claimed under Section 10. Travel allowance is usually paid by the company to those employees for whom the company doesn’t provide any transportation facility.

Conveyance allowance is granted to an employee, whose pay has not been fixed with special regard to the expenditure.

  • Calculation of Conveyance Allowance

The calculations of the conveyance allowance are supported by limits that are absolute at Rs.19, 200 per annum or Rs. 1,600 per month not related to tax.

Also, See: Professional Tax (PT) | Provident Fund (PF)

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