As part of the FY 23-24 Budget, the government made changes on the flexible benefits that are allowed in the New Tax Regime. These changes impact the applicability of flexible benefits defined in Section 10 and Section 17.
The rules state that, all flexible benefits under Section 17 are allowed in the New Tax Regime, whereas most of the flexible benefits under Section 10 are not allowed (except 3 benefits that are listed below).
Details of the flexible benefits and their exemption under different regimes -
Flexible Benefit Name | IT Section | Old Tax Regime | New Tax Regime |
Meal or Food Allowance | Section 10 | Yes | No |
Books and Periodicals Allowance | Section 10 | Yes | No |
Attire or Uniform Allowance | Section 10 | Yes | No |
Learning and Development Allowance | Section 10 | Yes | No |
LTA Allowance | Section 10 | Yes | No |
Conveyance Allowance | Section 10 | Yes | Yes |
Travel Allowance | Section 10 | Yes | Yes |
Daily Allowance | Section 10 | Yes | Yes |
Telecommunication or Phone Allowance | Section 17 | Yes | Yes |
Fuel Allowance | Section 17 | Yes | Yes |
Driver’s Salary | Section 17 | Yes | Yes |
Gadget or Device Allowance | Section 17 | Yes | Yes |
Health or Fitness Allowance | Section 17 | Yes | Yes |
Gift Allowance | Section 17 | Yes | Yes |
While we have made these changes keeping in mind possible spelling variations, there may be cases where a flexible benefit may not show up. If you're facing any issues in this, please reach out to our support on xpayroll@razorpay.com.