Leave Travel Concession (LTC) is one of the most popular tax benefits available to salaried employees. With the new Income Tax Act, 2025 set to come into force from April 1, 2026, many employees are wondering whether LTC rules will change. The draft Income-tax Rules, 2026 have now clarified how LTC exemption will operate under the new framework — and the good news is that the core structure remains largely the same. What LTC means under existing law (Income Tax Act, 1961) Under Section 10(5) of the Income Tax Act, 1961, salaried employees can claim tax exemption on Leave Travel Concession (LTC/LTA) for domestic travel within India. Here are the current key rules: -Two journeys in a block of four years (current block: 2022–2025) -Exemption available only for travel fare, not hotel, food or sightseeing -Eligible family includes spouse, children, and dependent parents/siblings -Exemption is restricted to actual travel cost, or LTA provided by employer — whichever is lower.