Kaushal Dey (name changed), a central employee, was searching for a car of his choice to take advantage of the Leave Travel Concession (LTC) cash voucher scheme. He has liked a sports utility vehicles (SUV) of 40 lakhs. The amount of money they will get in lieu of Leave Travel Concession (LTC) is much higher than the cost of the car. In such a situation, Kaushal will need an auto loan to buy a car. They can also get this amount in advance under LTC Cash Voucher.
Encashment up to 100% under LTC scheme
Under LTC scheme, an employee is required to have an encashment or encashment of up to 100 per cent and 50 per cent of the fair value is paid in advance to the employee. However, if the advance of this advance is not utilized or the entire amount is not utilization then it will be transferred to the dry and disturbing officers (DDOs) under the provision of LTC Advance.
It is mandatory to spend an amount equal to three times
If an employee claims to spend only advance amount after taking LTC advance, then it will be considered under-utilization. In such a case, the balance amount will be recovered from the employee.
It is important to note that in order to take full advantage under LTC Cash Voucher Scheme, the employee will have to spend an amount equal to three times the fair value and the leave encashment amount. This will depend on the LTC slab and the number of household members of the employee. Also, the leave encashment will depend on the pay scale.
Will be able to benefit on items with more than 12% GST
In terms of skills, the cost of the car is 40 lakhs and the entire amount will be utilized but does the scheme help an employee to buy a car through LTC advance and auto loan? It can be understood here that to take full advantage under LTC scheme, it is necessary that goods or services with more than 12 per cent GST can be consumed by this amount. This payment must be done in digital mode.
The motor vehicle has a GST rate of over 12 percent, so it can be taken under the LTC scheme. According to the founder of RSM India, Dr. Suresh Surana, the down payment can be made by taking LTC advanced facility to buy the car under the scheme.
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