Skip to main content

How to Claim Tax Exemption For Business Travel Expenses in India

In India, any person who earns above the base tax slab from his business or profession is legally obliged to pay Income Tax as in the rate, in which slab he falls, notified by the Government of India in a financial year. However, Income Tax Act 1961 allows professionals and businessmen to deduct expenses incurred while performing profession or business in the financial year from the net income in the same period. Cost of travelings for the purpose of business and profession is one of the major areas where your can save your hard earned money from paying Tax. In this article you will learn which all travels are counted as business travel and how to mention business travel cost in your Income Tax Return and claim Tax exemption.

Why Should We Include Business Travel Expenses in IT Return ?
Income Tax Act allows any person to deduct the the amount he spent for travels he made in order to perform his business and profession. Here profession means a work done by a person in order to make a living usually in a self employed manner. So anyone who makes earning by using his intelligence or physical strength (not salaried employees) like a practising doctor, CA, Lawyers, Freelance Engineers, Bloggers etc can be termed as professionals. Traveling for the sole purpose of profession and business is common among these people and Tax authorities understand it well. So they are allowed to deduct any money they spent for travels associated with pursuing an existing business. So the total revenue under 'Profits and Gains of Business or Profession' is the amount after deducting all expenses including business travel expenses.
  1. How to Save Tax By Using Share Market Trading Loss
  2. How to Claim Tax Deduction For Extra 50000 Rupees

Which Type of Travel Expenses Are Counted As Business Travel Expenses
It is important to note that, not all your travel expenses can be treated as business travel expenses and you cannot blindly ask tax deductions for those. Income Tax Department will look in to the nature of your journey and they must be convinced that the trip you made was essential for your business or profession. Another point Tax authority will check is the travel cost. You cannot claim unbelievable cost for the journey and demand Tax exemption while submitting your ITR.
  1. How to Make $100 Per Day From Internet
  2. Simplest Way to Link Aadhaar With PAN
  3. How to Link Aadhaar With Your SBI Account

How Can I Show My Vacation Tour As Business Tour to Cut Tax ?
You might be disappointed after listening the answer. You cannot claim any Tax deductions for your vacation trips. For example if you went to Manali for a week to enjoy with your family for the purpose of entertainment, you cannot show the cost of this journey as business expense in ITR. However, if you met some potential clients and you spent any money to arrange meeting with them, you can claim that amount as business expense.
Money Disappeared From Savings Account Remove a Beneficiary From HDFC Account
Delete a Beneficiary From SBI Account Compare Kerala & Gujarat Development Models

Important Points to Remember While Claiming Business Travel Expense
  1. Keeps All Bills and Receipts
    First of all, you must keep the receipts and bills related to the journey and all documents which prove why this trip was necessary for your business.

  2. Sole Purpose of The Travel Must be Business
    It is not necessary that you made any business during this journey but you must show Tax authority that this tour was for the sole purpose of your existing business. You cannot claim a trip as business trip if that trip is not related to any of your existing business or profession. In simple words, you cannot ask Tax benefits for trip made for the needs of a future business. For example if you are in catering business and you are planning to start a construction business. As long as you have not started construction business, you cannot claim tax relaxations as business travel for any of your trips related to your intention on future construction business.

  3. Travel Cost Must be Realistic
    You cannot claim an unrealistic amount as your business travel cost. You must also show the authority the mode of transport and where you stayed. You can include Hotel room rent you paid, laundry bills, Internet and phone bills (must be related to your existing business), meals bill etc in the travel expense.

  4. Travel Requirement Must be Justified
    Another important point you should remember while marking a journey as business journey is the point whether you can justify the intention of that trip. For example if you are a business man in Delhi and want to purchase an item which is available in Delhi. If you go to Mumbai for the sole purpose to purchase that item without much difference in quality or price from Delhi market, you cannot justify that trip.

  5. Mode of Payments
    It would be helpful for you while showing travel expenses if you made digital mode of payments as much as possible.
Which All Expenses Can be Included Under Travel Cost
You can include the cost of the mode of transport you used, room rent you paid, meals and other petty expenses while journey, laundry bill, tolls if you paid any during the drive, entry fee you paid if it was necessary for your profession, cost of arranging meetings with potential clients etc.

Comments

Recent Posts

How to Configure Idea 4G & 3G on Android Phone -APN Settings

When you activate Idea GPRS, 4G or 3G Internet on your Android phone, your phone will receive the automatic settings. However, sometimes you may need to configure the Access Point and GPRS settings for Idea (both GSM second and third generation) connection manually on your Android phone. In case if you delete the previous configuration, it is better know how to setup the same settings again by yourself. A wrong Access Point Name can stop you from accessing their mobile broadband service. Otherwise after deleting the existing APN for Idea 3G or GPRS you may need to re-insert the SIM again to get automatic settings from them. If you know the manual configuration steps, you can avoid that hardware procedure. If you are looking for the steps to get maximum speed from Idea 4G, you may click the link below and follow the instructions. The below hack will increase the Idea 4G data transfer speed.


Boost Idea 4G Data Transfer Speed

Steps to Configure Idea 4G/ GPRS/ 3G on Android Click on Applic…

Eligibility and Exam Pattern CBI Officer Recruitment 2017 - Sub Inspector By SSC CGL

To become an officer in Central Bureau of Investigation ( CBI ) is a dream of many youth in India. Though this elite investigation agency is popular among public, many do not know the procedure to join CBI as an officer. This article explains the various criteria, eligibility, exam pattern and procedure to become a CBI officer. Two different agencies conduct examinations to fill vacancies in CBI. They are UPSC and SSC. To become a group A officer in CBI, you must choose Civil Service Examination conducted by UPSC and become an IPS officer. To join as Sub Inspector in CBI, you must go through SSC CGL examination.

Name Of the Post Recruitment Agency Group A OfficerUPSC (Civil Service Examination)Sub InspectorSSC CGL
Where to Apply
If you are dreaming to become an Officer in CBI, you must pass the Combined Graduate Level Examination (CGL ) conducted by Staff Selection Commission (SSC) in every year. You must wait for the next SSC CGL notification and prepare for the same. It is a 4 tier …

Kerala Civil Excise Officer Examination (Women & Men) Notification

Applications to the post Civil Excise Officer ( Trainee) in Kerala Excise Department are invited by Kerala Public Service Commission. It is a district level examination and those who have passed Plus Two or equivalent can apply to only one district. Kerala Excise Department collects Excise Revenue for the state and it is their duty to enforce various Excise Acts. Excise Department is a law enforcement agency and control the manufacturing and distribution of alcohol and other Intoxicating Drugs. Civil Excise Officer is the new name given to Excise Guard and they are the lowest ranking enforcement officers in the department. Excise Guards ( older name of Civil Excise Officer ) are empowered with the power to arrest anyone who committed offence in a public place against the Abkari Acts.
Notification Number Name of The PostLast Date to Apply501/2017 Women Civil Excise Officer 03-Jan-2018 340/2016 Civil Excise Officer 14-Dec-2016 341/2016 Civil Excise Officer (Transfer) 14-Dec-2016
How …

Kerala Government Higher Secondary School Teacher Recruitment

Kerala PSC has invited applications from eligible candidates to recruit Higher Secondary School Teacher for Kerala Higher Secondary Education Department. Vacancies are available for teachers in various subjects and the detailed information is provided in the chart below. Monthly starting salary of Government Higher Secondary School Teacher (Junior) in Kerala Higher Secondary Eduction is 32300-68700/-Indian Rupees. Age limit to apply for Higher Secondary School Teacher post in Kerala for general category is 20 -40 years. Usual upper age relaxation is allowed for candidates belongs to OBC and SC/ST category. Kerala Government Higher Secondary School Teacher Examination detailed syllabus and previous year question papers are updated in the charts below.
Notification NumberName of the Post Last Date to Apply 246/2017Higher Secondary School Teacher (Junior) English20-09-2017 247/2017Higher Secondary School Teacher (Junior) Political Science20-09-2017 248/2017Higher Secondary School Tea…

PING: Transmit failed. General Failure - Reasons and Solution

Yesterday while checking network connectivity, I received one error message while trying to ping loopback address from my Windows computer. The error message I received is "PING: Transmit failed. General Failure" and all the packets send from command prompt were lost. I tried to ping a different loopback address but the result was same. I fixed the issue by following a set of steps and sharing those troubleshooting steps in this tutorial hoping it may help in case if you experience the same error message PING: Transmit failed. General Failure.


Broadband Hack To Improve Speed

This is the output I received when I ping loopback address.

C:\Users\sijugk>ping 172.0.0.21 Pinging 172.0.0.21 with 32 bytes of data: PING: transmit failed. General failure. PING: transmit failed. General failure. PING: transmit failed. General failure. PING: transmit failed. General failure. Ping statistics for 172.0.0.21: Packets: Sent = 4, Received = 0, Lost = 4 (100% loss)


Reasons an…

Modify SBI Inter-Bank Beneficiary For RTGS & NEFT

To complete online money transfer using either RTGS or NEFT in your State Bank of India net banking account, the first step is to add the account details of the person to whom you are sending money. Once the details are added under Inter-Bank Beneficiary list, you can start sending money to his/her account. However, it is possible that you might have entered wrong details while adding the beneficiary details. SBI allows users to either modify or delete a beneficiary if the user find the details incorrect. This article explains how to modify or delete beneficiary on SBI account within few minutes. The same procedure can be followed if you are seeing you have reached the maximum number of beneficiaries in your account while adding a new one.

Step By Step Instructions To Delete Beneficiary in HDFC Bank

Steps to Add a Beneficiary in State Bank Net-banking Account

Visit the SBI Netbanking login Link and enter netbank username and password.

https://retail.onlinesbi.com/retail/logi…