The employers offer many allowances to their employees. One of the allowance is given for conveyance.

Conveyance Allowance also known as Transport Allowance granted to an employee to meet expenditure on commuting between residence and place of duty.

It is exempted up to Rs. 1,600 per month i.e Rs.19,200 p.a (Rs. 3,200 per month for blind, deaf, dumb and handicapped employees) under Section 10(14) of Income Tax Act. 

 

Amount paid over and above the conveyance allowance prescribed limit is taxable under the head Income from Salaries. This exemption can be claimed by salaried individual employee.


Please do remember that you cannot claim the same at the time of filing your Income Tax return if your employer has not provided you the same.  

 

In Budget 2018, Standard deduction of Rs.40,000 has been proposed to replace Transport Allowance of Rs.1600 p.m i.e Rs. 19,200 p.a and reimbursement of miscellaneous medical expenses of Rs.15,000 p.a.


Amendment: In Budget 2019 proposals, Standard deduction of Rs.40,000 is increased to Rs.50,000 applicable for FY 2019-20 (AY 2020-21).